Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

BIRMINGHAM CORPORATION BILL

Lords Amendments considered and agreed to.

UNIVERSITY OF WALES INSTITUTE OF SCIENCE AND TECHNOLOGY BILL

Lords Amendments considered and agreed to.

LONDON TRANSPORT BILL

Lords Amendments considered and agreed to.

CITY OF LONDON (VARIOUS POWERS) (No. 2) BILL

Read the Third time and passed.

BRISTOL CORPORATION BILL [Lords]

To be read a Second time upon Thursday.

MEDWAY WATER (BEWL BRIDGE RESERVOIR) BILL [Lords]

Read a Second time and committed.

MID-GLAMORGAN WATER BILL [Lords]

To be read a Second time upon Thursday.

GREATER LONDON COUNCIL (GENERAL POWERS) BILL (By Order)

Consideration, as amended, deferred till Monday next at Seven o'clock.

GREATER LONDON COUNCIL (MONEY) BILL (By Order)

Read a Second time and committed.

Oral Answers to Questions — HOUSING

Mortgage Option Scheme

Mr. Rossi: asked the Minister of Housing and Local Government what response there has now been to the introduction of the 100 per cent. mortgage guarantee scheme.

The Minister of Housing and Local Government (Mr. Anthony Greenwood): According to a sample survey of building society mortgages, about 10 per cent. of mortgages completed during April were option mortgages and of these over 35 per cent. came under the guarantee scheme.

Mr. Rossi: Has the right hon. Gentleman any plans to extend the scheme to those with no money to put down as a deposit but who nevertheless will not obtain any advantage from the option mortgage scheme?

Mr. Greenwood: I have no power to do that at present.

Mr. Clegg: asked the Minister of Housing and Local Government what representations he has received to permit those who have exercised a mortgage option to change their decision.

Mr. Greenwood: Certain representations to this effect have been received, but there is no provision in the Housing Subsidies Act, 1967, for a properly given option notice to be revoked.

Mr. Clegg: Is the Minister aware that certain people who have taken on the option mortgage are now, because of the family allowances, paying more than they would have paid had they not taken it on? If the right hon. Gentleman cannot take action, will he have a word with his right hon. and noble Friend the Lord Chancellor to see whether he can do something on his side?

Mr. Greenwood: I have no power to do it at the moment, and I think that we have to take into consideration the interests of the various lending agencies who administer this scheme and who felt at the time that to introduce a choice of



this kind would add greatly to the complications of the scheme.

Mr. Barnett: Would not my right hon. Friend agree that genuine mistakes can be made and cause quite considerable difficulties, and that circumstances might change, too? In those circumstances, will he consider bringing in legislation to change the present situation?

Mr. Greenwood: As my hon. Friend knows, anybody can opt into the scheme but cannot later opt out. I think that we must have regard to the interests of the lending agencies who are responsible for the administration of the scheme.

Mr. Rippon: But does not the right hon. Gentleman understand that the questions put to him this afternoon show that there are grave deficiencies in the Act as it is now operating? Far too few people are exercising the option because its operation is too limited. Also, as hon. Members on both sides have said, the Finance Bill has perpetrated a fraud on some of the people who have got in.

Mr. Greenwood: Ten per cent. of existing borrowers have taken advantage and 5 per cent. of new ones, which is about what we originally estimated. I have not ignored the point which the right hon. and learned Gentleman makes, but at the moment I have not these powers and I see little chance of legislation in the immediate future.

Mr. Wellbeloved: Would my right hon. Friend bear in mind that this is a first-class piece of legislation, of which his Department is entitled to be proud, but that difficulties are being experienced? Would he undertake to review this within 12 months to see whether further legislation is required?

Mr. Greenwood: I am obliged to my hon. Friend. About 160,000 families among existing borrowers have already benefited and, on present figures, about 50,000 families per year among new borrowers will do so. We shall naturally keep the operation of the Act under review, and if we decide that any amendment is necessary we shall take that into account, but I cannot promise it at this stage.

Mr. Silvester: asked the Minister of Housing and Local Government what


modifications of the mortgage option scheme he is considering.

Mr. Greenwood: None, Sir.

Mr. Silvester: While the right hon. Gentleman has explained that he has no power at the moment to change the option mortgage scheme, is he aware that his booklet on the scheme explains that people paying tax of £80 a year are likely to benefit if they take the option and that that statement is no longer true? Has he any plans to change the booklet if he cannot change the law?

Mr. Greenwood: I share the concern of the hon. Gentleman. If, in fact, the booklet is now misleading, I will, of course, look at the point he raises and see whether any corrective action is required.

Mr. Brooks: While congratulating my right hon. Friend on planning to take this belated action, may I ask him to agree that where the Government takes financial measures which tip the balance of advantage against those who have taken up the mortgage option scheme there should be scope for some compensatory action so as not to cause great disillusion?

Mr. Greenwood: I am afraid not. [Interruption.] Taxation is a normal risk. This matter was thoroughly discussed in Committee when the Measure was going through the House, at which point hon. Members decided to approve the Measure in its present form. It is too early to start contemplating an amendment along the lines suggested by my hon. Friend.

Rents (Circular 25/68)

Mr. Murton: asked the Minister of Housing and Local Government why he has made no reference in Circular 25/68 to provision for increased costs in the period to 31st March, 1968.

Mr. Greenwood: The circular explained that the general aim should be to avoid putting up rents by more than the amount needed to cover the rise in costs in the year; but I accept that rent increases in 1968–69 may also reflect extra costs incurred before 31st March, 1968.

Mr. Murton: Would the right hon. Gentleman not consider amending his circular to take these costs into account



so that local authorities know where they are over proposed rent levels for local authority houses?

Mr. Greenwood: If the hon. Gentleman will read the circular—it was No. 25/68—he will find the point covered. The point which we were making there was that increases in rents should not cover anticipated increases in subsequent years, but we fully accept that any expenses incurred before the circular was issued can be taken into account for current increases.

Rent Officers

Mr. Graham Page: asked the Minister of Housing and Local Government what reduction in the number of rent assessment officers was made during the financial year 1967–68 and what reduction is expected during the present financial year.

The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): The net reduction in the financial year 1967–68 was 33 officers, of whom 19 were part time rent officers. It is expected that in the present financial year the reduction will be in the order of 30 officers, of whom more than half will be part time rent officers.

Mr. Page: Why should there be any reduction at all? Does not the hon. Gentleman realise that they will be required under the Government's announced policy in the White Paper, "Old Homes into New Homes"? Are the Government seriously intending to carry out that policy as early as possible?

Mr. MacColl: The answer to the last sentence is, yes, we are intending to carry out the policies of the White Paper. As to the other matter, we cannot keep staff hanging around waiting until the work is there. We must economise in staff.

Mr. Frank Allaun: Will my hon. Friend note the enthusiasm and persistence with which Conservative Members are pressing for higher rents through rent decontrol?

Mr. MacColl: I hope that my hon. Friend will not forget that there is much more in the White Paper than just high rents.

Immigrants

Sir G. Nabarro: asked the Minister of Housing and Local Government what further provisions he is now making for housing immigrants.

Mr. MacColl: I would refer the hon. Gentleman to the reply given to my hon. Friend the Member for Wolverhampton, North-East (Mrs. Renée Short) on 7th May.—Vol. 764, c. 202–3. Areas with severe housing needs are already being given priority, their programmes are proceeding apace, and the further urgent study of areas with special problems, including those with large immigrant populations, is being undertaken.

Multi-Storey Buildings

Sir G. Nabarro: asked the Minister of Housing and Local Government how many flats in multi-storey buildings are at present under construction; how many more are authorised and awaiting commencement, in design similar to the Canning Town block where disaster occurred, in May, 1968; what changes in policy he proposes pending publication of the report of the public inquiry; and whether he will make a statement.

Mr. Greenwood: At 30th April, 1968, 64,142 dwellings in multi-storey buildings of all types were under construction for local authorities and new towns in England and Wales. At the same date, 6,525 dwellings in multi-storey buildings in systems using large precast concrete load bearing panels were approved but not started. Of these, 29 dwellings were to be built by the system of construction used in the Canning Town block. I have asked the Chairman to pass on to me anything emerging in the course of the inquiry that indicates a need for interim action.

Sir G. Nabarro: How long does the right hon. Gentleman expect that it will be before the report on the Canning Town disaster is available for us to read? If it is likely to be any substantial length of time, is it wise for these constructions to proceed unimpeded all over the country when they are of the same design as the Canning Town block?

Mr. Greenwood: I said in my reply that 29 dwellings were to be built by the



system of construction used in the Canning Town block. Mr. Griffiths, the Chairman of the Tribunal, has not been able to give a date for the completion of his work, although he knows my view; that I would like to see the report as quickly as possible, consistent with a thorough investigation of the problem. The hon. Gentleman will appreciate the importance of my not saying anything at this stage which might appear to prejudge the findings of the Tribunal or might be likely to cause alarm in cases where alarm is probably uncalled for.

Mr. Chichester-Clark: While recognising the deep concern that exists over this matter, is it not important for us to keep a sense of proportion and recognise that industrial building on the high-rise plan has been going on successfully for more than 20 years in this country, in Europe and elsewhere?

Mr. Greenwood: I am obliged to the hon. Gentleman for that comment.

Mr. Winnick: asked the Minister of Housing and Local Government if he will now review the policy of encouraging local authorities to build very high blocks of flats.

Mr. Greenwood: I have not encouraged local authorities to build high flats. Indeed, they were asked on the contrary in Circular 36/67 to re-appraise their policies for housing densities and layouts where these appeared to demand a high proportion of high rise dwellings.

Mr. Winnick: While appreciating the difficulties of many local authorities, would it be possible for the Ministry to lay down a provision that before loan sanction is granted for particular schemes certain playing facilities for very young children should be included in all tall blocks of flats?

Mr. Greenwood: This is a problem which is under review by the sociologists in my Ministry, and I hope to be able to issue guidance to local authorities, probably later this year.

House Purchase Costs

Mr. Gwilym Roberts: asked the Minister of Housing and Local Government if he will initiate a study into the possibilities of constructing a complete

local authority register of property ownership with the aim of enabling houses to be bought and sold through the local authority as a simple log-book transaction, thus reducing house-purchase costs.

Mr. MacColl: No, Sir. Investigating the title of every property would involve a great expense and burden of staff. Much of the information is already available in the Land Registry.

Mr. Roberts: Would my hon. Friend accept that, while difficulty might arise in a few cases, 80 per cent. to 90 per cent. of houses bought and sold could be transacted on such a log-book basis? If one can buy an £8,000 Rolls Royce via a log book is there any reason why one should not be able to buy a £4,000 house in the same way?

Mr. MacColl: I am afraid that land attracts historic accretions which motor cars do not. I am sure that the best way to proceed is to push on with compulsory registration of titles.

Mr. Graham Page: Does the hon. Gentleman realise that the inadequacy of the registers at the present time is causing a great increase in the work of conveyancing? As a first step, will he look into the matter of seeing that all proposals and encumbrances on property are registered on one register in one place so that the work of conveyancing could be thereby reduced and the cost possibly reduced?

Mr. MacColl: We will certainly bear in mind what the hon. Gentleman has suggested.

Old People

Mr. Cordle: asked the Minister of Housing and Local Government what steps he is taking to assist local authorities to provide special housing for old people.

Mr. Gardner: asked the Minister of Housing and Local Government what priority is given to accommodation for the elderly in considering current local authority house building allocations.

Mr. MacColl: Housing of old people is one of the priority needs for local authority housebuilding and, as an encouragement, higher costs on houses with



special features designed for old people are admissible for subsidy.

Mr. Cordle: Would the hon. Gentleman agree that some of our housing problems could be dealt with by adopting a sensible policy of transferring council tenants to accommodation suited to their needs? Is he satisfied with the present provision of purpose-built flats for the elderly?

Mr. MacColl: The type of house to be built for old people is a matter for the local authority to decide, based on its local knowledge.

Mr. Gardner: Is my hon. Friend aware that some local authority flats built for elderly people provide a relatively cheap way of supplying initial accommodation in that when they are provided with alternative accommodation the elderly release their older houses? Will my hon. Friend ensure that in any representations he makes to local authorities this year he will see that this important area of accommodation is not cut?

Mr. MacColl: Accommodation suitable for old people represents, on average, 28 per cent. of the total public authority provisions; and as the total provision in this sector is going up, the amount of accommodation provided for old people is also going up.

Mr. Graham Page: Is it not a fact that the 28 per cent. average of annual output to which he referred has gone down every year while the Labour Party has been in office? What do the Government intend to do about this problem in the future?

Mr. McColl: The hon. Gentleman is wrong. The figure has remained stable over the years, although the absolute numbers have gone up because our output has been a record one.

House Purchase (Surveyor's Report)

Mr. Barnett: asked the Minister of Housing and Local Government if he will introduce legislation requiring building societies and others lending money for house purchase to provide copies of the surveyor's report to prospective purchasers who pay for such reports.

Mr. MacColl: No, Sir. To compel building societies to provide copies of these reports would imply that they were


more general help to purchasers than is the case.

Mr. Barnett: Is my hon. Friend aware that it simply is not good enough to accept uncritically the opinions of the Building Societies Association? Would he at least have discussions with the Association, which might be prepared to reconsider this matter, so that many hundreds of thousands of people who are paying money for something that they are not getting might see something for their money?

Mr. MacColl: I can assure my hon. Friend that we have had and continue to have discussions with the Association. It takes this view and, short of legislation, at the moment it does not seem likely to alter it.

Mr. Barnett: In view of the unsatisfactory nature of that reply, I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest opportunity.

Greater London Council (Rents Scheme)

Mr. Hunt: asked the Minister of Housing and Local Government what financial assistance he will offer to the Greater London Council in order to help it to meet an estimated loss of £1 million resulting from his refusal to allow the Council to proceed with its fair rents scheme.

Mr. Greenwood: None, Sir. Local authorities are not entitled to compensation from national funds for restraint on prices and incomes.

Mr. Hunt: Is the Minister aware that, as a direct result of his meddling interference, the ratepayers of Greater London are now being called upon to find an extra £4,500,000 in the course of the next two years? Is it not financial and social madness to force the G.L.C. to cut the rents of its top income tenants at the expense of the general ratepayers, many of whom are living in far less affluent conditions than some of the G.L.C. tenants?

Mr. Greenwood: As a result of what the hon. Gentleman kindly calls my "meddling interference", the average increase proposed has been reduced from 11s. 7d. to 7s. 6d. a week and the highest



individual increase reduced from 22s. 6d. to 10s. I think that is well worth while. The estimated loss of revenue to the G.L.C. is equivalent to about 1½d. general purposes rate.

Mr. Wellbeloved: Would my right hon. Friend bear in mind that a lot of nonsense is being put around about rent increases in the G.L.C? Is he aware that the unfair policy being operated by the present masters across the river is involving the placing upon tenants of charges which ought to be borne by the system at large, for example the Thames-mead scheme in my constituency?

Mr. Greenwood: I do not want to comment on individual schemes, but I am entitled to point out that the G.L.C. basic subsidy per dwelling went up from £24 under the previous Administration to £173 for the cost of a £6,400 house.

Mr. Rippon: Will the Minister agree that the G.L.C. policy is entirely in accordance with the Ministry's circular and advice on rent rebate schemes?

Mr. Greenwood: I am grateful to the authority for saying that there was a great deal of wisdom in the circular that I issued.

Mr. Molloy: Is my right hon. Friend aware that the phrase in the original Question, "fair rents" scheme, has been hotly disputed by tens of thousands of Londoners?

Mr. Greenwood: The proposal for a "fair rents" scheme was turned down by the Prices and Incomes Board, so it does not arise here.

Housing Society Dwellings

Sir B. Rhys Williams: asked the Minister of Housing and Local Government what number of dwellings he expects will be completed this year by cost/ rent housing societies and by co-ownership housing societies, respectively; and whether he anticipates any increase in 1969 in either category.

Mr. MacColl: Four thousand to 5,000 housing society dwellings should be completed in 1968, and a somewhat larger number next year. This year three-quarters or more of these are likely to be built by cost-rent societies, but many


of the dwellings will probably be turned over to co-ownership on completion. My right hon. Friend hopes that next year the proportion of co-ownership dwellings will be preponderant.

Sir B. Rhys Williams: Can the Minister explain the relative failure of these projects? Is it due to suspicion or lack of familiarity on the part of the public, or is it because district valuers are unduly timid in making their assessments of the rents that might be obtained?

Mr. MacColl: My right hon. Friend has invited a sub-committee of the Central Housing Advisory Committee, under the chairmanship of Sir Karl Cohen, to look at the whole problem of housing associations and housing societies. We will await the report with great interest.

Mr. Peter M. Jackson: Will my hon. Friend reveal the limit which his right hon. Friend has placed on the cost of these units? I understand that special permission has to be given to a housing corporation for any project or unit in excess of £5,000 and that no such permission has been given to date? Will he review that?

Mr. MacColl: This involves the use of public money and my right hon. Friend is most anxious that it should be used to meet the need for moderate rents and not be used for anything in the nature of luxury buildings.

"Old Houses into New Homes" (White Paper)

Mr. Frank Allaun: asked the Minister of Housing and Local Government approximately how many houses he expects to be removed from rent control under the proposals of the White Paper, "Old Houses into New Homes"; how many of these houses are already equipped with a bath, inside lavatory and hot water system; and over what period it is proposed to phase the ensuing rent increases.

Mr. MacColl: Our estimate is that after deducting dwellings in potential clearance areas about 200,000 let on controlled tenancies have the basic amenities and require less than £125 spending on repair. About an equal number might be brought up to a satisfactory state, but whether



they are so brought up will depend on the success of the policy outlined in the White Paper. On the last part of the Question, I cannot at present add to what is said in the White Paper.

Mr. Allaun: Is the Parliamentary Secretary aware that he is in danger of spoiling a first-class plan by this proposal, which will actually slow down improvement, because of tenants' resistance? Would it not be ridiculous if a tenant actually decontrols himself because he would be putting a bathroom into his landlord's house?

Mr. MacColl: The proposals in the White Paper are there for discussion. One of the matters that has to be considered is the failure so far to get improvements in privately rented houses. That is the problem to which the White Paper has to address itself.

Mr. Lubbock: Would the hon. Gentleman admit that these figures are pure guesswork? Can he tell the House how long it will be before the results of a survey, about which he told me in correspondence earlier this year, on the number of controlled properties will become available?

Mr. MacColl: The hon. Genteman is not far off in saying that there is a good deal of speculation in these figures. The survey should be ready by the end of the year, but I would not like to commit myself, because I know how severe the hon. Gentleman will be if I am slightly out.

Mr. Frank Allaun: asked the Minister of Housing and Local Government what financial assistance, other than cheap loans, it is proposed to give local authorities towards the greatly increased compensation they will pay property owners under the slum clearance provisions of the White Paper, "Old Houses into New Homes".

Mr. Greenwood: The proposals in the White Paper should not result in local authorities needing assistance beyond that available under the Housing Subsidies Act, 1967.

Mr. Allaun: While welcoming fairer compensation for owner occupiers, may I ask whether it is not clear that the whole burden will fall upon local authorities, who are already having to pay


£40,000 or more per acre for land in demolition areas?

Mr. Greenwood: The whole burden will not fall on the local authorities because of the subsidy system. Some will be borne by the Exchequer. The high cost per acre mentioned by my hon. Friend includes fit houses, public houses, shops, factories and other buildings of that kind. We have not received any objection from the local authority associations about the kind of burden which would fall upon them. I think it will be moderate and that in most cases local authorities will be happy to accept it.

Sir G. Nabarro: Is it not a fact that 50 per cent. of all increased costs of local authorities are due to excessively high interest rates resulting from the dear money policy of Her Majesty's Government, which goes on and on and on without diminution?

Mr. Greenwood: I am not certain that the hon. Gentleman's supplementary question arises from the original Question. Certainly the policy will go on until the economy is sound once again.

Overcrowded Dwellings

Mr. Moyle: asked the Minister of Housing and Local Government whether he will review the law with regard to the overcrowding of dwelling-houses, with a view to giving to local authorities powers to control the problem more effectively.

Mr. MacColl: The White Paper "Old Houses into New Homes" published on 23rd April sets out the Government's proposals for dealing more effectively with the problems of multiple occupation, which include overcrowding.

Mr. Moyle: Is my hon. Friend aware that local authorities are finding increasing difficulty in administering the existing law on multiple occupation due to the technical legal complexities and time-wasting procedures, as they regard them? Would he give this much more urgent attention, with a view to introducing amending legislation?

Mr. MacColl: It is because of the unsatisfactory nature of the existing legislation that we outlined the proposals in the White Paper. If there are any



ways in which my hon. Friend thinks the machinery could be improved, I should be very grateful to hear them.

Southampton

Mr. R. C. Mitchell: asked the Minister of Housing and Local Government how many families within the city of Southampton are still living in houses without bathrooms.

Mr. MacColl: Estimates based on the 1966 Sample Census show that about 6,750 households in Southampton were then without the exclusive use of a fixed bath. Specific information on bathrooms is not available.

Mr. Mitchell: Do not this figure and similar figures for other authorities indicate that many landlords are not taking advantage of their present opportunities to modernise older houses? If landlords are not: prepared to do it, what plans has the Minister for getting someone else to do it?

Mr. MacColl: I think that that is one of the points which will have to be looked at in connection with the White Paper. As I said in answer to my hon. Friend the Member for Salford, East (Mr. Frank Allaun), it is very important to get co-operation in the private sector.

Planning Blight

Mr. R. C. Mitchell: asked the Minister of Housing and Local Government what advice he is currently giving to local authorities regarding the purchase of properties in advance of requirements where planning blight exists.

The Minister of State, Ministry of Housing and Local Government (Mr. Niall MacDennot): My right hon. Friend has urged local authorities to buy in advance of requirements in cases falling outside the statutory provisions where there is genuine hardship.

Mr. Mitchell: Is my hon. and learned Friend aware that with the increasing number of road-widening schemes and similar plans large numbers of properties in many of the big cities are suffering from planning blight, and in some cases local authorities are very reluctant to buy in advance of requirements? Will he put some pressure on them?

Mr. MacDennot: We have made it clear to local authorities that loan sanction will be available for this purpose in hardship cases. If my hon. Friend has particular cases in mind, I shall gladly look into them.

Oral Answers to Questions — LOCAL GOVERNMENT

Loan Sanction Applications

Mr. Clegg: asked the Minister of Housing and Local Government what plans he has for enabling more decisions affecting local authority loan sanction applications to be taken in his Department's area offices.

Mr. MacColl: My right hon. Friend has arranged recently for schemes for the reclamation of derelict land within a limit of £150,000 per case to be settled in the regional offices.

Mr. Clegg: Could not the hon. Gentleman extend this devolution of authority to his regional offices so as to speed up administration?

Mr. MacColl: Facilities in the regional offices have been expanded, but it is too early to say that any extension would result in economies or speed.

Ratepayers (Assistance)

Mr. Murton: asked the Minister of Housing and Local Government what assistance he proposes for domestic ratepayers in 1969–70.

Mr. Greenwood: This will emerge after the negotiations with the local authorities on rate support grant this autumn.

Mr. Murton: Would the right hon. Gentleman give the House a firm declaration that he will not go back on the undertaking given by his predecessor on Second Reading of the Local Government Bill that in the next year the domestic relief would be the equivalent of 1s. 8d. in the £?

Mr. Greenwood: The rate support grant has to be negotiated every other year with the local authority associations. It would be a great discourtesy to them to anticipate the result of those negotiations, which will take place in the autumn.

Mr. Crawshaw: Is my right hon. Friend aware that the credit for this great benefit which has been given by the Government is being taken by many Conservative-controlled councils? Would he please make it clear that any stabilising of the rateable value has been brought about by the farsighted legislation of this Government?

Mr. Greenwood: I am very grateful to my hon. Friend. We are, of course, talking about rate poundage and the House may like to know that the net average increase for domestic ratepayers over the last three years has been only one penny, which I think is a tribute to the Government.

Mr. Rippon: Why will the right hon. Gentleman not answer clearly my hon. Friend's question? Will he acknowledge that if the relief next year does not amount to the equivalent of 1s. 8d. in the £, that will be another Government pledge broken?

Mr. Greenwood: I decline to give an answer at this stage because, unlike the right hon. and learned Gentleman, I hate being discourteous.

Mr. Rippon: Then how could it be given on Second Reading?

Betterment Levy

Mr. Rossi: asked the Minister of Housing and Local Government whether he will give a break-down of his estimate of the total cost of the assessment and collection of Betterment Levy in 1968–69.

Mr. MacDermot: I would refer the hon. Member to the Civil Estimates.

Mr. Rossi: Is the hon. and learned Gentleman not aware that the cost of collection over the ensuing year will be 5s. 6d. in the £ as against a revenue cost of 3·28d.? Does this not teach him some lesson or other?

Mr. MacDermot: I do not know what the hon. Gentleman means by a revenue cost of 3·28d. If he is referring to the cost of collection of Income Tax, that, of course, is a very cheap tax to collect. There are other taxes, many of them of great social importance, whose cost of collection is much greater. In any event, when a new tax is imposed the cost of collection is always high until it reaches


its full effect. For the reasons which I have given earlier, it will be some years before that is the case in relation to the Betterment Levy.

Land Commission

Mr. Graham Page: asked the Minister of Housing and Local Government how much land has been acquired by the Land Commission to date.

Mr. MacDermot: 4·3 acres have vested in the Commission; 14 acres are the subject of a confirmed compulsory purchase order; 450 acres are the subject of draft Compulsory Purchase Orders, and 190 acres at Hornchurch Airfield are being acquired from the Ministry of Defence. Contracts are likely to be exchange, or draft Compulsory Purchase Orders published for a further 2,000 acres within the next two months.

Mr. Page: Has the hon. and learned Gentleman any evidence which would lead him to believe that this could not have been undertaken by the ordinary compulsory purchase procedure of local authorities and others who have that right? Has the Land Commission carried out the other half of its duty in selling any of that land for development?

Mr. MacDermot: The Commission cannot resell until the land is vested in it, and the figures which I gave show the position there. As to whether this could have been achieved without the Land Commission, the Hornchurch Airfield example is admirable. This is surplus land which is now required for gravel extraction but which will later be needed for housing and schools. Without the intervention of the Commission, it would have been sold to private mineral operators who would later have realised the development value as an uncovenanted bonus. It will now remain in public hands, its benefit will accrue to the Exchequer and it will be possible to bring the land forward for development in a way which is suitable both for the local authority and for private developers.

Mr. Alan Lee Williams: Can my hon. and learned Friend explain why the Commission is buying the land from the Ministry of Defence? It is already publicly owned, so why is the Land Commission involved?

Mr. MacDermot: This, like other land which is surplus to requirements of the Ministry of Defence, has to be sold by them. There is no existing public authority other than the Land Commission which is in a position to purchase it in the present circumstances, for the reasons which I have explained.

Mr. Clegg: Can the hon. and learned Gentleman tell us whether any of the land acquired by the Commission will be sold as Crownhold?

Mr. MacDermot: That depends on whether the Commission receives requests for disposals on Crownhold terms.

Mr. John Fraser: Has my hon. and learned Friend seen the statement of Sir Henry Wells about the failure of local authorities to zone land in time to enable it to be released for housing development? What is he doing about that?

Mr. MacDermot: Yes, I explained to the House at our last Question Time that this was a matter on which the Commission was concentrating. This is, probably, the greatest single factor affecting land prices, and our Ministry is engaged, with the Land Commission, in discussions with local authorities in the pressure areas.

Planning Officers

Mr. Silvester: asked the Minister of Housing and Local Government what steps he is taking to ensure the recruitment of sufficient planners to meet the requirements of the Town and Country Planning Bill.

Mr. MacDermot: At my right hon. Friend's request, the University Grants Committee has made provision for a substantial increase in the number of university places for students of planning. They expect to see an extra 250 full-time and 250 part-time places by 1972. Additional places will also be available outside the universities.

Mr. Silvester: Will the Minister bear in mind that he needs to secure recruitment from the schools to these extra university places and that his chief planner has expressed concern at the possibility of there not being sufficient planners to put new legislation into operation? Does he feel that these new


plans are sufficient for his foreseeable requirements?

Mr. MacDermot: We share the concern expressed by the chief planner. It is for that reason that we took these steps and we hope by 1974 to have doubled the number of qualified planners in this country. As for the new planning system, I hope that as a result of it we will make better use of qualified planning staff and reduce the work on detailed matters, because this will tend to alleviate rather than aggravate the shortage of planners.

Sir Frank Pearson: Does the right hon. Gentleman recognise that the quality of these recruits is of vital importance if the whole operation is to be successful? Would he agree that it is better to wait until we can obtain recruits of the right quality than to rush the process and take in men who may not come up to the highest standard?

Mr. MacDermot: I do not see how one can attract more recruits unless one makes places available for them.

Large Buildings (Television Interference)

Mr. Onslow: asked the Minister of Housing and Local Government whether he will seek powers, by legislation or otherwise, to oblige the developers of large buildings to make provision for the preservation of adequate television reception in surrounding areas.

Mr. MacDermot: I understand that there are formidable technical problems in establishing the effect of a proposed building on television reception; and I see difficulty in requiring a developer to provide a service on land which is not in his ownership or under his control.

Mr. Onslow: Would the hon. and learned Gentleman accept that this phenomenon of the bouncing of television signals causes annoyance to residents near high-rise blocks? Will he consider the experience in France, where small repeater stations are installed in these circumstances and overcome the problem at small cost?

Mr. MacDermot: I would be glad to look into any possible solution of this;



problem, but I do not know whether the matter is dealt with in France as part of their system of planning control.

Radio Masts

Mr. Onslow: asked the Minister of Housing and Local Government whether he will ensure that adequate technical guidance is made available to planning authorities, and to applicants for the establishment of mast sites, for microwave communication systems on the requirements of such sites; and if he will apply the same limitations of planning control in this connection to nationalised industries as to private applicants.

Mr. MacDermot: A circular on planning control of radio masts has just been sent to planning authorities. A copy is available in the Library, and I will send one to the hon. Gentleman. Planning control applies to nationalised industries as to other developers.

Mr. Onslow: I am grateful for that assurance. If the nationalised industries are subject to the same control in this context, why should they not be subject to the same controls as private individuals in other contexts, such as gasometers and so on?

Mr. MacDermot: If the hon. Gentleman is referring to the position from the point of view of compensation for statutory undertakers—I gather that he has that in mind by his reference to gasometers—then that matter has been dealt with in the planning legislation.

Public Buildings (Lifts)

Mr. Worsley: asked the Minister of Housing and Local Government what guidance he gives local authorities as to the desirability of providing lifts in buildings to which the public require to have access, in such a way as to give access for persons in wheelchairs.

Mr. Greenwood: The attention of local authorities has been drawn to a pamphlet issued by the Ministry of Public Building and Works on designing public buildings with easy access for disabled people. This deals with the subject of lifts. I will send the hon. Member a copy.

Mr. Worsley: Has there been any change in practice in this respect? Very


often, even when a building has a lift, there are steps at the entrance which make it impossible for it to be used by people in wheelchairs.

Mr. Greenwood: When giving loan sanction we make a check on the suitability of the building for disabled persons. If the hon. Gentleman has any points, I shall certainly look at them.

Mr. Tinn: Will the Minister take steps to broaden this approach to draw the attention of architects designing commercial buildings, factories and so on to which the public have access, so that they are aware of this necessity also?

Mr. Greenwood: I think that the subject has been adequately covered, particularly in the case of a joint circular from the Ministry of Housing and Local Government and the Ministry of Health in November 1965 about access to public buildings for the disabled. But if my hon. Friend feels that there are gaps in the information available, I will do my best to remedy them.

Use Classes Order (Restaurants)

Mr. Worsley: asked the Minister of Housing and Local Government whether he will lay a Use Classes (Amendment) Order listing a restaurant in the Schedule of exceptions to Class I of the Town and Country Planning (Use Classes) Order 1963.

Mr. MacDermot: The hon. Member has let my right hon. Friend have information about the difficulties that gave rise to his Question. We will consider this together with other evidence when the Use Classes Order is reviewed shortly.

Mr. Worsley: I am grateful to the hon. and learned Gentleman for what he said. Will he consider this very sympathetically? A change of use into restaurants, perhaps on a large scale, can critically alter the environment of certain areas, and they should be within the purview of a planning authority.

Mr. MacDermot: Certainly, and I shall be glad to receive any further evidence hon. Members may have on this subject.

Council of Europe (Recommendations)

Mr. Blenkinsop: asked the Minister of Housing and Local Government what Her Majesty's Government's policy is regarding the recommendations included in the Report on Regional Planning adopted by the Assembly of the Council of Europe in May 1968.

Mr. MacDermot: These recommendations were adopted by the Assembly of the Council of Europe only last month and will now be considered by the Government.

Mr. Blenkinsop: Will my hon. and learned Friend give particular attention to the very valuable recommendations on exchange of technical information and to problems related to participation of the general public in planning procedures, which have particular partinence to our problems here?

Mr. MacDermot: Yes, Sir, and I am glad to say that in general terms I welcome the report and the recommendations. It may be that we shall have reservations on individual recommendations, but they will be carefully considered and we shall see what follow-up action, if any, is needed.

Mr. Shinwell: Will my hon. and learned Friend explain why this body, the Council of Europe, is recommending regional planning of the United Kingdom? Why does not it mind its own business?

Mr. MacDermot: I think that when my right hon. Friend reads the report he will see that what it is recommending is regional planning of Europe.

Derelict Land (Northern Region)

Mr. Blenkinsop: asked the Minister of Housing and Local Government what assistance the Land Commission is giving to reclaiming derelict land in the Northern Region by acquiring suitable sites.

Mr. MacDermot: Local authorities in the Northern Region were recently informed of the Land Commission's willingness to acquire on their behalf derelict land suitable for development.

Mr. Blenkinsop: Are there any further steps that can be taken to encourage the more rapid development of work in this field, as there is very wide scope for it? We are very anxious that the Commission should get ahead with this kind of purchase.

Mr. MacDermot: We have notified all local authorities that this service is available to them. The local authorities in the Northern Region receive very substantial grant—85 per cent.—for this purpose, but a number of them have been handicapped by not having suitable staff available to deal with the acquisition of sites. It is this service that the Land Commission will be able to provide.

EUROPEAN ECONOMIC COMMUNITY

Ql. Mr. Winnick: asked the Prime Minister what plans are now under consideration as an alternative to Great Britain joining the European Economic Community.
The Prime Minister (Mr. Harold Wilson): I would refer my hon. Friend to the Answers I gave to similar Questions on 28th and 30th May.—[Vol. 765, c. 1535–8; Vol. 765, c. 2127–9.]

Mr. Winnick: Can my right hon. Friend give any indication about our present application to join the E.E.C.? In view of the various suggestions which have been put forward by Members and people outside the House for an Atlantic free trade area, have the Government considered the possibility of studying these proposals? Our right hon. Friend the Member for Battersea, North (Mr. Jay) seems very interested in these suggestions.

The Prime Minister: As I have already told the House, the Government gave very close study to this as one of a number of possible alternatives before deciding on the application which we put to the House last May.

Sir D. Walker-Smith: Is not the Prime Minister aware that a great deal has happened since the Government gave such study as they did to this matter? Will not he improve on the very disappointing approach he has so far made


to the possibilities of this imaginative and challenging concept?

The Prime Minister: It is certainly imaginative and challenging, but we did not take the view that it was an immediately realistic one. As regards our application to join the E.E.C., as we have all said many times we have met with considerable frustration and disappointment, but I am certainly no more pessimistic about the success of that application now than I was a few months ago.

Mr. Anderson: Will my right hon. Friend confirm that he appreciates that any flirtation now with so-called alternatives will reduce our credibility in Europe and give ammunition to those on the Continent who have said in the past that we were not interested anyway?

The Prime Minister: I do not think that there is any doubt in Europe about our very real interest and very real purpose in this matter. As I have said, nothing that has happened in the past few months has caused us to change the recommendation we put to the House, which was so overwhelmingly endorsed a year ago.

Mr. Biggs-Davison: Is the Prime Minister aware that some of us think that the challenging concept of N.A.F.T.A. might be a little one-sided in its challenge so far as the other side of the Atlantic is concerned? In view of the ferment in both Western and Eastern Europe, should not we now be a little patient, because the opportunity might arise to build a more flexible European system more satisfactory to British interests?

The Prime Minister: I agree with what the hon. Gentleman says about ferment in Western and Eastern Europe. America has also had to face problems. But it has always been our idea, and I think the idea of many hon. Members, that our joining the Community would be on a basis that we would all hope to get a very outward-looking Community, linking with other parts of Europe and the world.

Mr. Jay: My right hon. Friend has referred several times to the Government's studies of these alternative policies. Does he agree that as these


studies, like others, have shown that there would be considerable economic advantages in some of them but possible political difficulties, it might now be wise to conduct a probe to see whether these political difficulties can be overcome?

The Prime Minister: I am not sure that in present conditions in Europe or in an election year in America this would be the best time to have a probe, even if I were convinced by the very eloquent propasals in my right hon. Friend's book.

SOCIAL SURVEY

Mr. Kenneth Baker: asked the Prime Minister whether he will transfer responsibility for the Government's social survey from the Chancellor of the Exchequer to the Lord President of the Council.

The Prime Minister: No, Sir. The present arrangement has only been working for just over a year and it would be premature to consider a change now before the developments in the Government statistical services, foreshadowed in the Answer I gave on 2nd April to a Question by the right hon. Gentleman the Member for Taunton (Mr. Du Cann) are more advanced.—[Vol. 762, c. 75–6.]

Mr. Baker: Is the Prime Minister aware that the 500 civil servants who work for the social survey have to report to the Chancellor of the Exchequer yet they do surveys for six other Government Departments? Is he further aware that as a result research projects are taking up to three years to complete? When will the Government give real priority to social research instead of merely paying lip-service to it?

The Prime Minister: We are carrying out the recommendations of the Hey-worth Committee, which studied the matter in great depth. It recommended that the social survey should be conducted for a number of Departments, for example. It would, therefore, not be appropriate for the survey to be attached to all these Departments and for the moment we are proceeding on the basis that it should be under the Treasury.

Mr. Sheldon: Since the Chancellor of the Exchequer raises £12,000 million and


the way in which he raises it is based at least in part on what he considers acceptable to the people, is it not time that techniques of survey and investigation were used more frequently to discover what is more readily acceptable?

The Prime Minister: I have no doubt that my hon. Friend and other hon. Members will be giving their advice to my right hon. Friend the Chancellor of the Exchequer during the passage of the Finance Bill on what they think will be acceptable and workable, but that is no reason for transferring responsibility for the social survey from the Chancellor of the Exchequer.

VIETNAM

Mr. Molloy: asked the Prime Minister if he will now make a further statement on the intentions of Her Majesty's Government to assist in achieving a settlement and procuring peace in Vietnam.

The Prime Minister: I would refer my hon. Friend to the Answers I gave to Questions on 23rd and 28th May and on 13th June, Sir.—[Vol. 765, c. 862–4, Vol. 765, c. 1530–1, Vol. 766, c. 1433–4.]

Mr. Molloy: Are we ready to help at any moment if called upon? Could we not help by keeping in close touch with the Soviet Union, bearing in mind its success at Tashkent? Are we prepared, if a cease-fire should be brought about, to give all aid possible in medical supplies and other forms in repairing the shattered lives of the Vietnamese people?

The Prime Minister: I have repeatedly said that we stand ready to help. We are in close touch with our Soviet co-Chairman, and my right hon. Friend the Foreign Secretary recently discussed all these matters with his Soviet opposite number, Mr. Gromyko. Of course, we shall be ready to do all in our power to help in binding up the wounds of Vietnam.

Mr. Gwynfor Evans: Will the Prime Minister point out to President Johnson that since America is the aggressor in Vietnam it has no right to demand reciprocity for stopping the bombing of North Vietnam?

The Prime Minister: I do not agree with the hon. Gentleman's premise and therefore, I cannot agree with the conclusion he draws from it. As I have made clear repeatedly, this is inevitably a horrible and ghastly war. With the bombing by one side there is also the ghastly shelling of civilians in Saigon by the Vietcong and North Vietnamese in recent days.

Mr. Park: Will not my right hon. Friend recognise that, until there is an absolute and unconditional cessation of bombing of North Vietnam by the United States, the Paris talks will make little progress? Will he not urge on the United States Government that reciprocity from the North Vietnamese will only follow and cannot precede the cessation of American bombing?

The Prime Minister: I am aware that this has been repeatedly stated over the past two years and more by the authorities in North Vietnam. It was one of the great difficulties faced by all of us concerned in getting the parties to the conference table. But now that they are at the conference table it is not for any of us to make it more difficult by saying what will and what will not be acceptable. The important thing is to keep them at the conference table.

Mr. Tapsell: Is it not shocking that at the very time the Americans have stopped bombing in the vicinity of Hanoi the Communists should have launched an all-out offensive on Saigon?

The Prime Minister: I have mentioned that this is one of the factors to be set out on the other side against the serious matters raised about the effect of the American bombing. All this proves the necessity for both sides to recognise that there will be no military solution but only a political solution and that they should get on with their talks.

UNITED KINGDOM AND UNITED STATES (ECONOMIC DISCUSSIONS)

Mr. Gwilym Roberts: asked the Prime Minister when he will now visit the United States of America to discuss with President Johnson questions of international liquidity.

The Prime Minister: As the House knows, I have no present plans to visit



the United States, but Her Majesty's Government are, of course, in frequent and close touch with the American Administration on all matters of common concern, including international liquidity.

Mr. Roberts: Would not my right hon. Friend accept, however, that, in view of the vital need for international liquidity, there is urgent need for talks on this matter at the highest level? Would he accept that in this field, as in many others, we have a great deal of common interest with the United States?

The Prime Minister: Yes, Sir. My hon. Friend will no doubt have been glad to see the progress which, although slow for a long time, has recently been made on the special drawing rights and also the progress made at the recent Stockholm conference, when my right hon. Friend the Chancellor of the Exchequer represented this country. We are in the closest touch with the United States. I have been in touch at various times with President Johnson and my right hon. Friend the Chancellor of the Exchequer is in very close touch with Mr. Secretary Fowler.

Mr. Ian Lloyd: Can the Prime Minister say whether the recent attempts to insulate gold stocks by the Group of Ten against gold speculation are being successful?

The Prime Minister: I think that the general view of City commentators as well as bankers and other observers is that the two-tier system has got off to a reasonably successful start—perhaps more successful than some pessimists thought. Of course, there have been upsets in the market, not least because of events in France and South Africa. But the United States and Britain are aware, of course, that the scheme depends on both getting their balance of payments into equilibrium as soon as possible.

Mr. Cant: Does not my right hon. Friend agree that the international liquidity problem for us is not associated with the drawing rights but with the capacity of this country to absorb short-term assets from abroad into our secondary banking system, which makes us increasingly vulnerable as a nation to trends in the financial world outside?

The Prime Minister: I have heard my hon. Friend on this subject a number of


times, and everyone recognises the vulnerability created for sterling by its being not only a reserve currency but an international trading currency widely accepted and used for trade. One of the most important steps is the efforts being made through the Basle mechanism to deal with the problem of the sterling balances.

WASH BARRAGE

Mr. Derek Page: asked the Prime Minister what steps he proposes to take to ensure the co-ordination of activities of the Department of Economic Affairs, the Ministry of Transport, the Ministry of Agriculture, Fisheries and Food, and the Ministry of Housing and Local Government concerned with the desk study of the Wash barrage.

The Prime Minister: I would refer my hon. Friend to the Answer given by my right hon. Friend the Minister of Housing and Local Government to a similar question by him on 11th April. It will be for the Water Resources Board to co-ordinate the several parts of the study including any undertaken by Government Departments.—[Vol. 762, c. 326–7.]

Mr. Page: How can my right hon. Friend justify the spending of public money on an investigation concerned primarily with water when everyone knows that other factors such as port facilities and land reclamation are of the greatest importance? Does not he agree that the time has come to transfer the study to the Department of Economic Affairs?

The Prime Minister: My hon. Friend has followed this matter from the beginning and has taken a leading part. He has discussed it with me several times and he will be aware that, whatever ambitious scheme might be proposed on some future occasion in relation to this area, it will still be essential to have a study of the water resources, such as that being done by agreement of my right hon. Friend and which my right hon. Friend told my hon. Friend about recently.

Sir D. Renton: But if there is to be a separate study of each of the advantages of this vital scheme, will it



not take many years for any Government to reach a decision? Is that the purpose of the Government?

The Prime Minister: The right hon. and learned Gentleman will be aware that the original study by the consulting engineers involved an extremely high cost on their estimate, which was very much a speculative estimate, as to what the whole water scheme would involve. For that reason, my right hon. Friend did not feel able to go forward even with the feasibility study then considered, but he has sanctioned a much smaller study and we had better see how that goes.

SECRETARY OF STATE FOR THE HOME DEPARTMENT (SPEECH)

Mr. Bruce-Gardyne: asked the Prime Minister whether the public speech of the Secretary of State for the Home Department at Blackpool on 28th May on prices and incomes legislation represents the policy of Her Majesty's Government.

Mr. Orme: asked the Prime Minister if the public speech of the Secretary of State for the Home Department, at Blackpool on 28th May on prices and incomes policy represents the policy of Her Majesty's Government.

The Prime Minister: I answered very similar Questions on 11th June, Sir, and fully elaborated my Answer in oral exchanges on 13th June. I have nothing to add to what I said then.—[Vol. 766, c. 27–8, 435–8.]

Mr. Bruce-Gardyne: I have studied those exchanges with care and the Prime Minister did not seem to answer the question. On 28th May, the Home Secretary said that there must not be further legislation on prices and incomes after 18 months. Does the Prime Minister agree that there must not be further legislation or not?

The Prime Minister: I dealt with this matter fully last week. I said that the policy is as stated by me in my speech to which I referred in my previous Answer and in a public statement. If the hon. Gentleman or any other hon. Member interprets the statement of my right hon. Friend the Home Secretary as implying that the options cannot be kept open and that there must be no legisla-


tion, the answer is that this is not the Government's policy.

Mr. Orme: Is my right hon. Friend aware that criminal sanctions are still the central theme of the prices and incomes policy and have now been condemned by the Donovan Report? Will he now not confirm what my right hon. Friend the Home Secretary said—that we must not continue this policy after 18 months, even if it has to go on now?

The Prime Minister: No, Sir. I do not accept the simplification my hon. Friend has put about criminal sanctions. In the second place, the House will have to consider the Donovan Report in relation to a long-term solution to our industrial relations. With regard to the present legislation, I have said repeatedly that we hope that, given success with the three factors I have mentioned, it will not be necessary to introduce further legislation, but I would be wrong to give a pledge that there will be no further legislation.

Sir Cyril Osborne: May I put a new point to the Prime Minister on this issue? He will remember that the Home Secretary said that he believed that a prices and incomes policy was necessary. He said, secondly, that he did not believe it should be compulsory. How can he get a policy agreed, without imposing legislation, if the trade unions will not accept his policy?

The Prime Minister: The hon. Gentleman has rather over-simplified my right hon. Friend's speech. He certainly agreed, as do nearly all of us in the House, on the need for a prices and incomes policy. He went on to say that he supported the legislation at present before the House. I have explained many times why we feel in present circumstances that it is necessary to supplement the trade union voluntary policy with legislation.

Mr. Shinwell: Is my right hon. Friend aware that some hon. Members on these benches, and I think in other places, regard the speech of the Home Secretary in Brighton as a first-class speech? We agree with the contents of it. Would he extend a bit further this example of private enterprise by members of the Cabinet, so that the members of the



Cabinet could disclose occasionally what they really think?

The Prime Minister: If my right hon. Friend is in full agreement with the speech of my right hon. Friend the Home Secretary, I find it difficult to understand why he did not vote for the legislation which my right hon. Friend the Home Secretary says he supports.

Mr. Peyton: Perhaps the Prime Minister would be willing to say, with his usual precision, whether he endorses the remark made by his right hon. Friend that when the new legislation runs out —[HON. MEMBERS: "Reading."]

Sir Cyril Osborne: It is a quotation.

Mr. Peyton: I fully understand that the quotation from the Home Secretary is unpalatable.

Mr. Speaker: It is not only unpalatable, it is out of order.

Mr. Peyton: Would the Prime Minister say, with his usual precision—[Interruption.]

Mr. Speaker: Order. The House must hear the question.

Mr. Peyton: Would the Prime Minister say, with his usual precision, whether or not he endorses the remark made by the Home Secretary that when the new legislation runs out there will be a need for a voluntary policy?

The Prime Minister: Sir, there is a need for a voluntary policy. I have said


in my own speeches that there is a need for a voluntary policy. This is what we are working towards, and it is where the other party manifestly failed in 13 years. The hon. Gentleman was stopped from reading the quotation—I am trying to help the hon. Gentleman now—but if he was quoting a reference that there must be a voluntary policy, no, I do not endorse that statement for reasons that I have said.

NEW MEMBERS SWORN

Keith Bruce Campbell, esquire, Q.C., for Oldham, West.

Edward Griffiths, esquire, for Sheffield, Brightside.

BALLOT FOR NOTICES OF MOTIONS FOR MONDAY, 1st JULY

The following hon. Members were chosen in the Ballot:

Mr. George Lawson.
Mr. Terence Boston.
Mr. Dudley Smith.

Parliamentary Reform

Mr. Dudley Smith: I beg to give notice that on Monday, 1st July, I shall call attention to the need to reform the present state of Parliament, and move a Resolution.

OUTLAWRIES (No. 2)

3.38 p.m.

Mr. Nigel Birch: I beg to move,
That leave be given to bring in a Bill for the more effectual preventing of clandestine withdrawals of passports from British subjects.
As many hon. Members know, the Outlawries Bill, which, for greater clarity, perhaps I should call the Outlawries (No. 1) Bill, has been read in the House at the beginning of every Session since 1727. During those 240 years it has made no further progress. I have no doubt that the Editor of The Times—and we all put on record our regrets that his many efforts to enter Parliament have been unsuccessful—would look at this as further proof, if further proof were needed, that our procedure requires reform.
On the other hand, the symbolic value of this is very great. Ever since 1603 the House has introduced and passed the First Reading of a Bill which was not contained in the Queen's Speech. It is to show that in this House we have the right to give priority to discussion of matters other than Government business. At a time when the House is so much in the power of those who both hate Parliament and fear it, it is valuable that we should not tear away the decent draperies of Parliamentary procedure.
The Outlawries (No. 1) Bill is in existence in manuscript form in the Public Bill Office. Much of it is obscure and would amuse the leisured and the learned. But the general drift of it is perfectly clear. The Long Title is that it is a Bill for the better prevention of clandestine outlawries. What that means in modern terms is that it is a Bill to prevent people's rights being taken away by forms of secret skulduggery and, as the apprehension of an intelligent audience runs far ahead of the power of the speaker to express himself, I have no doubt that the House is aware that I am about to discuss passports.
My Bill seeks to prevent the secret removal of passports and the secret refusal to issue them, and it is the second which is by far the most important.
The House will remember that, when speaking in the debate about Sir Frederick Crawford's passport, my right hon.

Friend the Member for Kinross and West Perthshire (Sir Alec Douglas-Home) gave an instance of a young man who had written to him to say that his Rhodesian-born wife, resident in this country for four and a half years, had been refused a passport in her married name for more than six months. He did not say whether she had been asked to sign a declaration, but I suspect that she had.
I had an instance some time ago of a neighbour of mine who married a Rho-desian girl some years ago. By accident, she had a Rhodesian passport. He husband is a United Kingdom citizen resident here. He is a farmer. Her mother in Rhodesia had a stroke, and she had to fly to Rhodesia to see her. At that time, she had a Federal passport. When she got to Rhodesia, she was informed that her Federal passport was no longer valid. She asked for a United Kingdom passport. She was told that she was entitled to one, but that the formalities would take a long time, and that it would be much quicker to get a Rhodesian passport. She did so, and subsequently returned to this country.
When U.D.I. came, she wanted to take a holiday abroad with her husband—not, I may say, in Rhodesia. She was told that she could have a United Kingdom passport for six months only, provided that she signed an anti-Smith declaration.
It is quite unheard of to be required to make a political declaration before being given a passport. In Hitler's time, no one who married a German girl was asked to make an anti-Hitler declaration. No one was asked to make an anti-Stalin declaration if he married a Russian girl.
Immediately that this was brought to my notice, I rang the Private Office of the Foreign Secretary, who was the present Foreign Secretary in his previous avatar. I spoke to someone there, but I have no idea of his name. I said, "This is incredible. There must be some mistake." He replied "I agree. I have never heard anything like it." The poor man has no doubt found out since what sort of masters he is serving.
Suppose an Englishman married an Ibo girl. Would she be asked to sign a declaration that she supported the legal Government of Nigeria and supported the sale of arms to the legal Government in order that they might butcher her people?
In the past, it has been accepted that the wife of a United Kingdom citizen had a right to a United Kingdom passport. Now we are told that no one has a right to a passport and that it is a matter of prerogative. That is one of the most formidable "boss" words. It means the ipse dixit of a Minister.
The first part of my Bill lays down that the wife of a United Kingdom citizen has a legal right to a British passport. I hope that everyone will support that. The second part of the Bill concerns the withdrawal of passports and the review procedure announced yesterday by the Secretary of State for Commonwealth Affairs.
The third leader in The Times today makes the most devastating criticism of the Secretary of State's proposals. I have not time to elaborate on the matter now, but I think that they are wrong. The point is that the Secretary of State said that he was not bound by the findings of the review body and would prevent anyone from going to the Parliamentary Commissioner subsequently.
The terms on which the Advisory Committee has to make its decision could not be more vague. I do not know how it is to decide whether Sir Frederick Crawford was wrong not to sign the book in Government House, Salisbury. Per-


sonally, I have never signed the book in any Government House, so perhaps I may lose my passport.
My Bill lays down simply that everyone has a right to take his case to the Parliamentary Commissioner, whether it is for the removal of a passport or the refusal to grant one, and it is mandatory upon the Ombudsman to consider it. It lays down, too, that the Government have no right of certification to prevent the Parliamentary Commissioner doing his duty. Those seem to me to be two perfectly simple and good provisions.
Mr. Speaker, you will recollect that today is the anniversary of the Battle of Waterloo. I hope that it will inspire hon. Members to support the Bill and pass it through all its stages in less than 240 years.

Question put and agreed to.

Bill ordered to be brought in by Mr. Birch, Sir Derek Walker-Smith, Sir John Foster, Mr. Fletcher-Cooke, and Mr. Paget.

OUTLAWRIES (NO. 2)

Bill for the more effectual preventing of clandestine withdrawals of passports from British subjects, presented accordingly and read the First time; to be read a Second time on Tuesday next and to be printed. [Bill 175.]

FINANCE BILL (BUSINESS COMMITTEE)

Motion made, and Question, That the Report [13th June] of the Business Committee be now considered—[Mr. Peart], put and agreed to.

Report considered accordingly.

Question, That this House doth agree with the Committee in the said Resolution, put forthwith, pursuant to Standing Order No. 43A (Allocation of time to Bills) and agreed to.

Following is the Report of the Business Committee:

That the following provisions shall apply to the Proceedings on recommittal and on report: —

Allotted days

1.—(1) The Proceedings on recommittal shall be completed in three days and shall be brought to a conclusion at 7 p.m. on the last of those days.

(2) The Proceedings on report shall be completed in four days and shall be brought to a conclusion as follows—

New Clauses and the Bill to the end of Clause 49 in the Bill, as amended by Standing Committee A—11.20 p.m. on the third of those four days.

All remaining Proceedings—7 p.m. on the last of those four days.

(3) On recommittal and on report, Amend ments to the Schedules shall be considered after the Amendments to the Clauses to which those Schedules relate in the same order as in the Standing Committee on the Bill.

Supplemental

2.—(1) When the Order of the Day is read for the House to resolve itself into Committee on recommittal of the Bill, Mr. Speaker shall leave the Chair without putting any Question notwithstanding that notice of an Instruction may have been given, and on the conclusion of the Proceedings in Committee, the Chairman shall report the Bill to the House without putting any Question.

No dilatory motion with respect to, or in the course of, Proceedings on the Bill in Committee or on report shall be made except by a member of the Government, and the Question on any such motion shall be put forthwith.

Standing Order No. 13 (Motions for leave to bring in bills and nomination of select committees at commencement of public business) shall not apply on an allotted day.

No opposed private business shall be taken on an allotted day.

3.—(1) For the purpose of bringing to a conclusion any Proceedings in accordance with these recommendations which have not previously been brought to a conclusion, the Chairman or Mr. Speaker shall forthwith proceed to put the following Questions (but no others), that is to say: —

(a) the Question or Questions already pro posed from the Chair, or necessary to bring to a decision a Question so proposed (in cluding, in the case of a new Clause or new Schedule which has been read a second time, the Question that the Clause or Schedule be added to the Bill); 
(b) the Question on any Amendment or Motion standing on the Order Paper in the name of any Member, if that Amendment or Motion is moved by a member of the Government;
(c) any other Question necessary for the disposal of the business to be concluded,

and on a motion so moved for a new Clause or a new Schedule, the Chairman or Mr. Speaker shall put only the Question that the Clause or Schedule be added to the Bill.

(2)Proceedings under sub-paragraph (1) of this paragraph shall not be interrupted under any Standing Order relating to the sittings of the House or under the Order [12th December] (Sittings of the House).

(3)If, at Seven o'clock on an allotted day, any Proceedings on the Bill which, under these recommendations, are to be brought to a conclusion at or before that time have not been concluded, any Motion for the Adjournment of the House under Standing Order No. 9 (Adjournment on specific and important matter that should have urgent consideration) which, apart from these recommendations, would stand over to that time shall stand over until those Proceedings have been concluded.

(4)If, on an allotted day, a Motion is made for the Adjournment of the House under the said Standing Order No. 9, the bringing to a conclusion of any Proceedings on the Bill in accordance with these recommendations at any hour falling after the beginning of the Proceedings on that Motion shall be deferred for a period equal to the duration of the Proceedings on that Motion.

(5)If on a Motion made after Ten o'clock on an allotted day under the said Order [12th December] Mr. Speaker suspends that day's sitting till Ten o'clock in the morning, the bringing to a conclusion of any Proceedings on the Bill in accordance with these recommendations at any hour after Ten o'clock at night shall be deferred for a period equal to ' the duration of the suspension of the sitting.

(6) Any deferment under sub-paragraph (5) of this paragraph shall be in addition to any deferment under sub-paragraph (4) thereof.

4. In these recommendations 'allotted day' means any day on which the Bill is put down for consideration either on re-committal or report as the first Government Order of the Day.

FINANCE (RECOMMITTED) BILL

[FIRST ALLOTTED DAY]

Considered in Committee.

[Sir ERIC FLETCHER in the Chair]

Clause 2 HYDROCARBON OILS

3.47 p.m.

Sir Gerald Nabarro: I beg to move Amendment No. 1, in page 2, line 33, leave out 'elevenpence' and insert 'eightpence'.

The Chairman: With this Amendment, I think that it would be convenient for the Committee to discuss Amendment No. 153, in page 2, line 33, at end insert:
(b) (i) the duties specified in the foregoing subsection shall be charged at the rate of three shillings and eightpence where the aforesaid oils are delivered for home use as a propellant fuel for invalid carriages, as exempted from vehicle excise duty under section 6 of the Vehicles (Excise) Act 1962;
(ii) vouchers in one gallon and five gallon units shall be issued by the Ministry of Transport and made available on demand at Post Offices; and where such vouchers bear the registration mark and class of vehicle concerned, or some other appropriate and specific mark of identity, and the vouchers as thus marked have been duly stamped or endorsed by a justice of the peace or an officer of a local authority, the holder of such a voucher shall, on surrendering it, be entitled to buy and to receive hydrocarbon oils bearing duty as specified in subsection (b)(i) above in the quantities designated on the said voucher, in and only in the vehicle thereon specified; and the retail or wholesale suppliers of such hydrocarbon oils, in exchange for such vouchers received, may buy and receive hydrocarbon oils at the aforesaid rate of duty charged, in the quantities designated, from his supplier.
No. 154, in line 33, at end insert:
(b) (i) the duties specified in the foregoing subsection shall be charged at the rate of three shillings and eightDence where the aforesaid oils in question are delivered for home use as a propellant fuel for vehicles modified for invalids as defined under section 11 of the Finance Act 1964;
(ii) vouchers in one gallon and five gallon units shall be issued by the Ministry of Transport and made available on demand at Post Offices; and where such vouchers bear the registration mark and class of vehicle concerned, or some other appropriate and specific


mark of identity, and the vouchers as thus marked have been duly stamped or endorsed by a justice of the peace or an officer of a local authority, the holder of such a voucher shall, on surrendering it, be entitled to buy and to receive hydrocarbon oils bearing duty as specified in subsection (b) (i) above in the quantities designated on the said voucher, in and only in the vehicle thereon specified; and the retail or wholesale suppliers of such hydrocarbon oils, in exchange for such vouchers received, may buy and receive hydrocarbon oils at the aforesaid rate of duty charged, in the quantities designated, from his supplier.
and No. 155, in line 33, at end insert:
(b) (i) the duties specified in the foregoing subsection shall be charged at the rate of three shillings and eightpence where the aforesaid oils are delivered for home use as a propellant fuel for vehicles qualified to display, and displaying, disabled driver car badges as specified in Ministry of Health circular 17/61;
(ii) vouchers in one gallon and five gallon units shall be issued by the Ministry of Transport and made available on demand at Post Offices and where such vouchers bear the registration mark and class of vehicle concerned, or some other appropriate and specific mark of identity, and the vouchers as thus marked have been duly stamped or endorsed by a justice of the peace or an officer of a local licensing authority, the holder of such a voucher shall, on surrendering it, be entitled to buv and to receive hydrocarbon oils bearing duty as specified in subsection (b) (i) above in the quantities designated on the said voucher, in and only in the vehicle thereon specified; and the retail or wholesale supplier of such hydrocarbon oils, in exchange for such vouchers received, may buy and receive hydrocarbon oils at the aforesaid rate of duty charged, in the quantities designated, from his supplier.

Sir G. Nabarro: This Amendment is concerned with motor spirit, largely for motor cars. However, before embarking on my speech, I want to make one or two observations about our procedure today in the context of the Amendment. Sir Eric, your first selection demonstrates at once the crass fatuity of the system of recommitting the Bill to the Floor of the House. I am about to make a speech calling for a reduction in the amount of duty on motor spirit, which will very largely be a reproduction and repetition of the speech made in Standing Committee by my hon. Friend the Member for Barkston Ash (Mr. Alison).
My arguments may differ slightly, but the gravaman of the charges against the Socialist Administration for a huge increase in the duty on motor spirit will be almost exactly the same. Why we


have to endure a repetition of this kind of thing, I cannot think.

Mr. R. B. Cant: Mr. R. B. Cant (Stoke-on-Trent, Central) rose—

Sir G., Nabarro: I will give way in a moment to the hon. Member. He should not get agitated yet. He will have a great deal to provoke him before I am through today.
Of course, the arguments having been thoroughly canvassed upstairs—sadly without my presence on the Committee— [HON. MEMBERS:. "Why did you not go there?"] The cacophony opposite of cries, "Why did I do go there?", if I heard them correctly, is evidently in total ignorance of the facts of the situation.
Immediately it was decided that the Finance Bill should be taken in Committee upstairs, I offered my services. [HON. MEMBERS: "Oh!"] I suspect that the Chancellor took all possible steps to avoid my presence on the Committee. He knows of my behaviour in the House during the last 15 or 20 years but so far, save only for a modest Second Reading speech, I have been disenfranchised during the detailed discussions in Committee on a Bill which raises the level of taxation in Britain by a bigger margin than any Bill in the whole of Britain's history.
There is no better method of epitomising the increase in the level of taxation in a single record than in the matter of motor spirit. [Interruption.] Perhaps the hon. Members opposite who are jeering at me will have memories long enough to recall that in 1964 the present Prime Minister and the present Home Secretary—

Mr. Joel Barnett: On a point of order, Sir Eric. It might help hon. Members if we could be told whether, on each Amendment throughout the course of the Recommittal stage, we are to have a sort of Second Reading debate.

The Chairman: I was myself beginning to think that we should most profitably use the time allotted by the Business Committee for the Recommittal stage of the Bill if we applied ourselves to the particular Amendments that have been selected rather than to extraneous matters.

Sir G. Nabarro: No extraneous matters have fallen from my lips yet, Sir Eric.

Otherwise, you, in your meticulous fashion, impeccable in your chairmanship, would have called me to order at once.
I was reminding the jeering Socialists opposite that in 1964 and in 1966 both the present Prime Minister and the present Home Secretary, immediately prior to the General Elections of those years, promised the entire electorate of Britain that there would be no call for substantial increases in taxation. Yet in no sphere has there been a sharper and heavier increase in taxation than in the burden falling on the motorist in this country.
The Chancellor regards this form of taxation as sumptuary. If he asks me to define sumptuary, I should say it is a consumer tax capable of easy and relatively painless collection. I hope that he will agree with that definition. That is why this heavy burden has fallen on the motorist. Time and again, since 1964, in flagrant violation and contradiction of pre-election promises, the tax on the motorist, that is on his motor spirit, has been sharply increased. [Interruption.]
I am glad to have driven one Socialist from this Chamber, a temporary incumbent of his seat with a majority of only 80 votes. I am sorry that the hon. Member jeered. He will not be here to survive the broken promises in regard to increased duty on motor spirit. In 1965, again in 1966, again in 1967, and again in 1968, the Chancellor has singled out motor spirit for an increase, and this year the amount was 4d. per gallon.
This first Amendment seeks to reduce the amount of the increase from 4d. per gallon to 1d. per gallon. The cost of the Amendment would be approximately £57 million. If calculated pro rata, the 4d. per gallon on motor spirit would yield £76 million for a full year, of which about one half is for motor cars and about one half for commercial vehicles. If the amount of the increase were thereby reduced to one 1d. per gallon instead of 4d. per gallon, it follows that the increased tax collected would be about £19 million in a full year and the cost of the Amendment would, therefore, be about £57 million in the full year.
The figure of the increase of the tax burden on the motorist was not put to the Committee upstairs in terms of the aggregation of increase in taxation on the road



user. Measuring 1964, that is, the year ended 31st March, 1964, against the year ending 31st March, 1969—a span of five years—in the first of those years the total sum collected from road user taxation was £777 million. During the year to 31st March, 1969 the total sum raised from road user taxation will have reached the phenomenal figure of £1,561 million. It more than doubled in five years.
Out of the £777 million in the year to 31st March, 1964, £120 million was contributed to Purchase Tax, £171 million to licence duties and the bulk, £486 million, to motor fuel taxation. In a span of just five years motor fuel taxation has risen from £486 million to £946 million, licence duties to £421 million, and Purchase Tax to £194 million, the total reflecting this increase of more than 100 per cent., from £777 million to £1,561 million, from all road user taxation.
Even the most vicious Socialist—[HON. MEMBERS: "Are there any?"] Are there any? They are all vicious in their attacks on taxpayers, because the party opposite believes utterly in a high level or taxation at all times.

Mr. Cant: Nonsense.

4.0 p.m.

Sir G. Nabarro: The hon. Member says, "Nonsense", but can he believe in a lowering level of taxation when his party has not reduced a single tax in four years? This Amendment has been selected first because the Socialists regard motoring as a luxury, notwithstanding that there are 10½ million motor car owners in Britain today, the majority of whom own small cars. They are not all Tories by any means, but they will all be Tories at the next election. The Chancellor does his party no greater disservice than year after year to pile increasing taxes on the shoulders of the motorist without any hope of reduction at any future date. He is justifiably unpopular on that account. There is no easier way of raising a cheer at a Parliamentary by-election these days than by talking about the fiscal iniquities of the Chancellor of the Exchequer in the context of motor taxation. The second easiest way to raise a cheer is to talk about his inflationary policies.
When the Chancellor puts up by 4d. a gallon the duty on motor spirit he adds at once a great sum of money to the cost of the distribution of food and all the essentials of daily life. It may be true that the Selective Employment Tax— which I hope we will be debating here tomorrow—is a powerful factor in inflationary tendencies. I put easily second the increase in motor duties both in respect of spirit and the motor duty licences because they go straight on to the price of the articles in the shops. They go on overnight.
If hon. Members do not believe me ask the Co-ops. The Co-ops are the principal offenders. It is always they who campaign for a reduction in the duties on motor spirit; a reduction in Selective Employment Tax, or its abolition. Most largely the Co-ops are concerned with distribution; only to a minor extent with manufacture. The Co-ops at least have learned one eternal verity of commerce, which is that all indirect taxation is viciously inflationary— [Interruption.] The hon. Member for Stoke-on-Trent is mumbling away about wanting more inflation. Does he want more inflation?

Mr. Stanley Orme: No, you want it.

Sir G. Nabarro: I wish, Sir Eric, that you would restrain the hon. Gentleman the Member for Salford, West (Mr. Orme) from shouting "You this and you that". I will give way to the hon. Member for Stoke-on-Trent if he wants to intervene.

Mr. Cant: I tried once before. I was merely saying that you and your colleagues on that side of the House—

The Chairman: Order. Hon. Members should address their remarks to the Chair.

Mr. Cant: I have sat here on many occasions when hon. Members opposite have made plea after plea to my right hon. Friend the Chancellor of the Exchequer to reduce the balance of taxation in favour of greater indirect taxation and less direct taxation.

Sir G. Nabarro: You kindly selected today Amendment No. 25, Sir Eric—

The Chairman: Order. We cannot, on this Amendment, enter into discussion



about the relative merits of direct and indirect taxation.

Sir G. Nabarro: I entirely agree. The hon. Member for Stoke-on-Trent, Central (Mr. Cant) does not understand the rules of order. He must be more careful. On a later Amendment I shall discuss the whole matter of indirect taxation. I am not going: to be drawn on it today.
I am sure that every quarter of the Committee will agree that an increase in the duty on motor spirit—and half of this increase is in respect of commercial vehicles—is violently inflationary because it adds to the cost of distribution at every stage and is as vicious in an inflationary context as the Selective Employment Tax. For all these reasons I must deplore the Chancellor's decision to raise the petrol duty.
The right hon. Gentleman has doubled the burden on road users' taxes between 1964 and 1969. That is a dismal record indeed and an utter contradiction of the promises he and his Cabinet colleagues made before the General Election of 1964 and before the General Election of 1966. I shall continuously and unremittingly rub his nose in these fiscal facts during the short remaining period between this date and the next General Election.
I am delighted that my oratory is sufficiently seductive to attract the hon. Gentleman to sit below the Gangway.

Mr. Gordon Campbell: I should like to support the Amendment. My hon. Friend has pointed out with clarity that motorists and road vehicles have had to bear a tremendous burden of taxation. I and my hon. Friends from Scottish constituencies are sorry that you have not selected our Amendments affecting Scotland, Sir Eric, but the general position of taxation in the country is one that concerns us a great deal.
The Ministry of Transport, some months ago, commissioned a study of what was called track costs with the object of working out to what extent motor vehicles covered the costs of the roads and services which they used. When that report was issued, a short time ago, I suspect that the Minister—it was the former Minister—was surprised to find out what we had been telling her from this side of the House for a long time—that the total of taxation paid by

road vehicles amounted to about twice as much as is spent on the construction and maintenance of roads and related services. This was the conclusion in the report after calculations by several methods.
That report on track costs completely undermined what the Minister was trying to do in the Transport Bill with two taxes there, and it was not surprising that those two taxes were removed from the Transport Bill. Unfortunately, the Chancellor is now trying, through fuel duty and the Excise duties, to raise the equivalent amount of money, and a lot more, almost twice as much as would have been raised under the taxes under the Transport Bill. Therefore, I support my hon. Friend in seeking to stop the huge increase being proposed in this Bill on petrol duty.
Turning to Scotland, when hon. Gentlemen on the Front Bench opposite and on the benches behind fail to recognise that general increases in transport costs have a greater effect on the remoter areas of Britain than elsewhere, one realises how little they know about what goes on in different parts of the country. When we have pointed out in debates in the House and upstairs that a substantial increase in the costs of road transport has a greater effect in raising costs in the North of Scotland than it does in an industrial area in the South, hon. Members on the other side have actually disputed this on the grounds that the respective duty is the same in both places. The important point that they have failed to appreciate is that distance enters into ordinary life and business activities in the remoter areas, so that the additional cost of transport is more damaging than in other areas.
To illustrate this simply, where markets and supplies are 100 or 200 miles away, an increase in transport costs has much more damaging and painful effects than where markets and supplies are only five miles away. I have put this simple point to the Government in the past and they have sought, with their supporters behind them, to dismiss it.
This is a matter of great concern to Scotland, particularly to the North and West Highlands. One Amendment which we put down, to which I will merely refer in passing, sought to exempt the islands. This was on a good precedent, because



the Government agreed to one of our Amendments to the Transport Bill and announced exemption from quantity licensing in the case of the islands. In this Amendment we have taken the wording which the Government used to define the islands in theirs.
Certainly, in the islands and the North and West of Britain extra transport costs mean that petrol is considerably more expensive to buy at the petrol pump than in the South of England. The extra costs of sea and other additional transport mean that petrol is more expensive when dispensed and retailed. I refer to that in passing, because that is an example of remote areas which suffer additionally when there are substantial increases in transport costs. I hope that the Government, for the first time, will start considering these remote areas and the damage that is being done to them when transport costs are increased.
It is all very well for the Government to talk about development boards and what they are doing with investment grants, which in fact, only go to manufacturing industries. General talk by the Government about regional development becomes nonsense when it is completely contradicted and nullified by measures like this which, to such an extent, put up the costs of transport.

Mr. Angus Maude (Stratford-on-Avon): The reason we feel strongly about increases in fuel duties is that this form of indirect taxation is infinitely more vicious and inflationary than any other. I am astonished that right hon. and hon. Gentlemen opposite have not been able to appreciate this. There is a case, which we cannot debate in detail here, for moving from direct to indirect taxation, but this form of indirect taxation enters into the costs not only of distribution but of production of almost all goods in the country.
It has an effect on the competitiveness of our exports and on raw materials being carried by road. Everything carried by road to the factories suffers in this way. It has a cumulative and multiplying effect which spreads throughout the whole of industry. Not merely that. It also has a vicious and distorting effect on the whole transport system. It is impossible to get the most

efficient transport system in the country through the operation of market forces if the Government distort the relative costs of different kinds of transport every time they get into a mess with their finances and bring in an allegedly deflationary Budget.
My hon. Friend the Member for Moray and Nairn (Mr. G. Campbell) spoke of the effect on the remote areas of Scotland. It has an effect everywhere in the countryside. We are in terrible trouble in the Midlands with our rural transport. Buses are continually being taken out of service because they are uneconomic. More and more people rely upon cars to get to their jobs. The combined effect of the increase in petrol duty and the increase in motor vehicle licence duty has been that innumerable working-class people have been forced to lay up their cars, and they are now finding great difficulty in getting to work with railway lines and rural bus services being closed down all the time.
I do not want to detain the Committee further. However, it should be obvious that this particular tax increase has an effect which spreads throughout all classes of the community. It has an adverse effect on export, it is directly inflationary, and it causes confusion and discomfort in a way that other forms of indirect taxation do not. I hope that the Chancellor will see fit to accept the Amendment.

4.15 p.m.

Mr. John Nott: I should like to add a few words in support of my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro). I believe that this increase in petrol duty will bear extremely hardly on the rural areas of the country. It is an exceptionally regressive form of taxation which one does not expect from a Socialist Chancellor.
In 1952, petrol duty was 2s. 6d. In 1964, after many years of Conservative government, it had been raised to 2s. 9d., an increase of 3d. After only four years of Socialist Government, petrol duty has been raised by nearly 50 per cent. and now amounts to 3s. 11d. In four years the duty on petrol has been raised by a vastly greater amount than the mere 3d. which occurred during the years of Conservative rule.

The Financial Secretary to the Treasury (Mr. Harold Lever): The Financial Secretary to the Treasury (Mr. Harold Lever) indicated dissent.

Mr. Nott: The Financial Secretary shakes his head. I hope that he will comment on my figures when he gets up to speak.
I believe I am right in saying that now the petrol duty is designed to raise £1,100 million. It involves an increase of nearly £75 million this year. This is an enormous burden to place on the poorer sections of the community, who, to a large extent, will bear this burden.
In his Budget statement the Chancellor indicated that only about 50 per cent. of families owned motor cars. That may well be the case taking the country as a whole; but, taking the outlying rural areas, the proportion of car ownership is very much greater. By necessity, the only people who do not own cars in most of the rural areas are old ladies and young children who cannot hold a licence. The rest of the community require cars, because there are no bus services.
In half the constituency which I represent there is no bus service of any kind. In another part I speak for about 6,000 people in the Lizard peninsula of Cornwall, where the bus services are practically non-existent. Hard as we try to get them replaced, it is impossible. I believe that Cornwall has a higher proportion of car ownership than anywhere else in the country, which is a most interesting figure bearing in mind that, according to the Inland Revenue, in income terms it is probably the poorest part of the country. In Cornwall, people need cars to get to work, to go shopping, to go to church, to deliver meals on wheels, and to provide an auxiliary hospital service for old people who want to get to and from hospital. A car is certainly not a luxury in rural areas. It is an absolute necessity.
If the Chancellor continues to increase petrol duty, it can only lead ultimately, and quickly at the present rate, to rural depopulation of our villages. Surely it is right that one of the Government's principal aims should be to try to change the trend towards rural depopulation by their regional development policies. I cannot think of any single tax—and this goes with Selective Employment Tax—which

is more calculated to act against the Government's regional development policies than an increase in petrol duty of this nature.
This duty will also bear particularly hardly on those parts of the country which rely for their principal industries on early potatoes, fish, cabbage, and other horticultural and fishing products, where the transport element in total distributive costs is very much higher than it is in respect of a commodity which is perhaps—

Mr. Tony Gardner: For the sake of clarity, will the hon. Gentleman tell the Committee the price of petrol in those countries which are our most serious competitors in horticultural products?

Mr. Nott: The argument about whether we have higher petrol prices, or lower taxes, or better living conditions than the French, the Germans, or the Italians is time-wasting and ridiculous. I am not concerned with the petrol tax in France, Germany or Holland. All I am concerned in seeing in this House, and in representing my constituency, is that the petrol tax does not rise to such a degree that people are prohibited from doing their shopping and going to work. The petrol tax in France and Germany is no concern of mine in dealing with the Amendment. This tax bears particularly hardly on areas where horticulture plays an important part, or where the fishing industry is of extreme importance, and for this reason I fully support this important Amendment.
I said earlier that this was an especially regressive tax. It will add greatly to the cost of living in the outlying areas where, because of their distance from the main centres of population, transport costs form a far greater proportion of total costs than they do in Birmingham, or London, or in the central parts of the United Kingdom.
It is astonishing that in West Cornwall, after deductions for National Insurance contributions and taxation, the take-home pay of the average worker is about £12 a week. The average level of council house rents is perhaps £3 a week. This means that the margin on which the average worker has to live is about £9 a week. If petrol tax is raised in the way contemplated, and following, as my hon. Friend says, the motor vehicle duty increases,



there will be a substantial increase in the cost of living in areas where the average take-home pay amounts to the figure which I have mentioned.
The Multiple Shop Federation—and I think that it made these calculations in connection with the Transport Bill— reckons distribution costs due to the increases in petrol tax and motor vehicle licences are likely to rise by between 9½ per cent. and 11 per cent. This represents a 1¼ per cent. to 1½ per cent. increase in the final selling price of goods. My constituents with an average take home-pay of about £12 a week are in no position to bear this further impost of 1¼ per cent. to 1½ per cent. in the price of necessary commodities like food and fuel.
I support the Amendment. I know that the Financial Secretary is a generous, warm-hearted man, and that he has with him a brief which will shortly indicate to us that the Amendment has been accepted.

The Chairman: Sir Douglas Glover.

Hon. Members: Hear, hear.

Sir Douglas Glover: After those warm words of greeting to me, I am sorry that I cannot say to the benches opposite that my speech will be filled with much joy and feelings of happiness.
I support what has been said by my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) about the Amendment. All our taxation is far too high, and is strangling the initiative of the nation. I agree with my hon. Friend the Member for St. Ives (Mr. Nott), who says that he is not concerned with taxes in France, or Germany, or anywhere else. Most of the developed countries are getting themselves into the situation of having a taxation structure which is out of balance, and where the population has less and less control over its environment. Control is in the hands of the State, and the supreme example of this is the taxation of fuel.
One knows that the rise in petrol tax and the increase in taxation of the internal combustion engine since the Government took office is due to the fact that they have a built-in prejudice against the motor car. It is no use the Financial Secretary laughing. They are still convinced that anybody who has a car is automatically a plutocrat, and perhaps I might prove that by evidence.
During my short period in the House, when the Conservative Party, dealing with the matter in a much more practical manner, as is their wont, brought in an alteration to the electoral system whereby any political party could use as many cars as it wanted to at election time, Labour Members seethed with rage. They said that it was being done to create a bias against the poor people who had no cars. They said that they would not be able to go and vote, whereas, in fact, as everybody knew, as many people who went to the polls in cars voted Labour as they did Conservative.
Hon. Gentlemen opposite still have that prejudice. They think that there is something slightly indecent in a family having a car, so this tax is designed to try in some way to put the clock back and force us all to give up our cars. They know that they will not succeed, but they are paying the right sort of tribute to those old and ancient glories of the past. When they are thinking about where to get some more "lolly" to do some more "goody business" somewhere, they say, "The easiest way of raising money is to put another tax on petrol and on the automobile; to put another tax on any form of transportation except rail". That really is how the tax structure on the automobile and on the fuel that it uses has grown up.
I am certain that when we were in power we were all the time fighting against this in the Treasury, because this is an easy way of raising money. It is very much simpler and in many ways a less painful way of raising money than getting it by other taxes, but over the years all that it has succeeded in doing is to put an enormous burden on our industrial machine because so much of the oncost is due to the taxes we are discussing this afternoon.
This tax structure reduces our competitiveness and makes the demand for increased wages stronger, because when people find that their basic needs—and surely one of the basic needs is the ability to transport oneself from A to B—cost more, they say that to balance the increase they must have extra wages and salaries. These taxes bear heavily on the means of transportation, and particularly on the transportation of the individual.
One of my hon. Friends spoke about the effect of this tax in rural districts. I know how it affects many people in my constituency. But it is not only the rural districts. My rural friends should remember that when one is in bottom gear, in a traffic block or sitting waiting for the lights to change in an urban district, one is probably using petrol at a greater rate per minute—not per mile—than those in rural districts.

4.30 p.m.

Mr. Maude: The point we were making, particularly in respect of rural areas, is that in urban areas it is possible for people to get to work by public transport whereas in many rural areas today there is no public transport at all to get people to work.

Sir D. Glover: I was not disagreeing with my hon. Friend, for I agree with him; but I was pointing out that the problem of the cost of running a car still applies, with this increased taxation in urban areas almost as much as in rural areas.
I would ask the Financial Secretary to say on what grounds the Treasury can justify the increase, not just in this Budget but ever since the party opposite (got into power? The increase in petrol alone is almost 50 per cent., not taking into account increased taxation on the vehicles themselves and so on. On what basis of principle have these taxes been increased? I know that the hon. Gentleman may say, "We have a very largely increased amount of spending in the Budget. We have to raise the money from somewhere and we feel that this is as fair a way of raising it as any".
I start off with the premise that I believe we are spending too much. I think that all of my hon. and right hon. Friends on this side of the House would agree. But let us start with the Socialist view that we are not spending too much and that what we are spending is all carefully organised and very sound, meeting with the private support of the Financial Secretary, who has no doubt that this is most desirable, and that this is an ideal world in which to live. Let us work on that assumption. I would still say that any person trying to get a fair collection of money to cover the bill, this expenditure, would inevitably conclude that today we are raising too much of it from the fuel tax.
If we take direct and other taxation, we are raising far too high a percentage today from fuel taxation. I would like to know, therefore, knowing of the increase that this puts on the cost of living, distribution and transportation, what philosophy, what thinking has gone on in the three years since the Labour Government got into power that has caused them in those three short years to increase fuel taxes by almost 50 per cent., and how they can justify that as a basic sensible policy, in a society in which petrol is a vital necessity, needed not by a small minority but by the great mass of the nation, both in their own private lives and in their commercial and industrial lives, so that it is a part of the life blood of the nation.
How can the Government believe that they are increasing efficiency and increasing the well-being of the nation when they are increasing these taxes by 50 per cent. in three short years? Until the hon. Gentleman can give a satisfactory reply to that—and I do not think he can—I am quite certain nobody on this side of the Committee will have any doubt at all that my hon. Friend's Amendment ought to be enthusiastically supported.

Mr. Julian Ridsdale: I hope that the protests we make on this side of the House will one day make the Government realise that it is wiser to cut Government spending than to face the increased taxation which the country is having to face today, including petrol tax. I do not want to get into a Second Reading argument here about the merits of direct or indirect taxation, or about the general level of Government spending. I merely want to say, in support of my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), that this tax on petrol and all the other taxes the Government have introduced are inflationary and are adding to the cost of production. I want, also, to support my many hon. Friends from rural areas. Those who have small fixed incomes know how much this tax is affecting them and their pockets.
I speak with great feeling, because just recently, in my constituency, the bus fare from one rural town to another, a distance of 20 miles, has gone up by no less than 40 per cent. and this at a time when we are talking about keeping prices



and incomes steady. This is partly caused by the kind of increased tax on petrol that the Government have introduced. The comment of my hon. Friend the Member for St. Ives (Mr. Nott) that the price of petrol had increased since Labour came into power from 2s. 3d. to 3s. 11d., an increase of 50 per cent., makes one realise why some bus fares are going up in the way they are. I use this opportunity which my hon. Friend the Member for Worcestershire, South has created to protest most strongly to the Government at the 40 per cent. increase in bus fares which has taken place during the last week or two in my constituency.

Mr. Marcus Worsley: Sir Eric, you have chosen for discussion with Amendment No. 1, to which previous speakers have addressed themselves, three Amendments in the names of my noble Friend and three of my hon. Friends, and my remarks are mainly devoted to those. I do not want to suggest that I do other than wholly support the case that has been made from this side. I do not believe that this Government have ever understood the blow-lamp which they have put under the boiler of inflation by their continuous increases in petrol tax.
I want to refer not to the general case against tax increases on this scale, but to the particular case of the effect of increases in petrol duty on a particular category of people, namely, the disabled. You ruled, Sir Eric—obviously rightly— that a general debate on direct and indirect taxation would be out of order at this point. I am not for a moment attempting to challenge that Ruling. All I would like to do is to quote the words of the right hon. Gentleman the Chancellor of the Exchequer, in his Budget speech, on indirect taxation:
… indirect taxation, to some extent at any rate, offers the individual a choice. If he is horrified by the impost he can abstain from some part of his consumption and produce the same demand reduction by saving. I certainly should not object to that."—[OFFICIAL REPORT, 19th March, 1968; Vol. 761, c. 276.]
These words are tragically ironic when applied to the kind of people covered by these three Amendments. It is harsh and ironic to say that there is any element of choice for a person whose ability to get around and enjoy life depends on his

invalid chair. There is an overwhelming case, in the terms of the Chancellor's own advocacy of indirect rather than direct taxation, for an exemption for these people.
I know that the Financial Secretary will criticise the admittedly somewhat cumbrous machinery which would be involved; and no one on this side would pretend that it is other than cumbersome. But it is the increase in petrol tax which has created the need for this machinery. I would agree if the hon. Gentleman preferred a system of moderate petrol duties with the same tax paid by the fit and disabled, but we have outrageously high petrol duties which have also been sharply increased in normal and interim Budgets since 1964. Therefore, these are not normal times. These increases have borne hardly on a section of the community which no one would wish to single out for punishment. Therefore, there is an overwhelming case for this cumbrous machinery to make a humane alteration.
I say this the more because, for people who rely on an invalid carriage, it makes all the difference whether they can use it freely and without too much thought of the cost or whether they have to be careful about it. These people have had no compensating increase in benefit since the Budget and there is none in the offing. I hope that the hon. Gentleman will not use the promised increase in supplementary benefit as an argument against the Amendments. These people have suffered substantial increases in costs and no compensating advantage, and I hope that the Committee will support the Amendments.

4.45 p.m.

Mr. Geoffrey Wilson: I support the Amendments. There is still a tendency, in an emergency, when we need more revenue, to turn to the so-called luxuries and to lump petrol with wines, spirits and tobacco. That is obsolete, because petrol has long ceased to be a luxury. My hon. Friend the Member for St. Ives (Mr. Nott) was right to say that, in the remoter areas, particularly Cornwall, petrol is a necessity. We have largely lost our rural railways and are losing our rural bus services, and the number of cars there is greater per head of the population than anywhere else. My hon. Friend was right to say that, in Cornwall, despite this large number of



cars, incomes are much lower. I would have thought, in fact, that the average take-home pay was less than the £12 a week which he mentioned.
Rural dwellers must use their own transport to get to work. When agriculture and tin mining were the main industries in Cornwall, men walked to work, but many fewer people are now employed in agriculture, because it is more mechanised, and the tin mines have gone, although we hope that they will return. The only possible employment for many in the villages is in the towns and their only means of transport is their own, although they may find it difficult to maintain a car or motor cycle.
Moreover, many families of moderate incomes are two-car families, because the husband needs one for work and the wife needs another for shopping. Families of similar means in London would not dream of having two cars, but this is a necessity in these areas, and petrol tax increases bear hardly there. I hope that this will be borne in mind.

Mr. George Younger: I regard this debate as a general protest at continuing rises in petrol duties rather than at this particular one. We must bear in mind that raising petrol revenue has ceased to have much to do with hydrocarbon oils or petrol, but has become simply a method of raising taxation. If the Financial Secretary proposed a new form of taxation and suggested putting it blindly across the population, irrespective of means or conditions, he would be rightly and severely criticised, but every time the hydrocarbon oils duty is raised it falls more hardly on those who depend on petrol to get about and do the normal things which appeal to most of us who spend much of our time in cities.
We all think, first, of the hardship to people who run cars, but a much greater hardship, which has a far wider effect, is the immediate and noticeable increase in shop prices caused by an increase in petrol duty. This is no myth; one can see an immediate increase in prices of detailed items following such an increase of duty, particularly in remoter areas. I was in a small village shop about four weeks ago to buy a few things, and in that one visit I found

three small grocery items which had gone up in price by 1d. in the previous week or so.
I was told that it was because of increased transport costs. The proprietor could not specify whether this meant increased petrol costs or licence duty, or the effects of the Transport Bill, but it was clear that it was largely due to increases over a long period in the price of petrol. The effect is direct and painful, particularly on remoter areas. My hon. Friend the Member for St. Ives (Mr. Nott) mentioned particularly the fact that people in these areas have lower average earnings than in the country as a whole.
While I shall be delighted if the Financial Secretary agrees with the case we have been making, I hope that he will at least give an undertaking that in the months ahead the Government will look very closely indeed—far closer than they have done before—at the possibility of grading increases in petrol duty in favour of the remoter areas. There would be nothing unusual, new or extraordinary about there being differing prices for petrol at garages throughout the country. One need only travel north, into the Highlands, or towards the South-West, to see that different prices are charged the further one gets from the distribution points.
There would be no difficulty in administering such an arrangement and having different rates of hydrocarbon oil duty for remoter petrol stations. The Treasury would get a lot of co-operation from the oil companies in drawing the demarcation lines, and so on, and there would be little difficulty in establishing this principle. Once established, it would benefit all because the more overcrowded the South-East and the other large centres become the more advantageous it is for people to be encouraged to live in the less cramped areas. Such a move would be in favour of the Government's regional policy and the Government would be thanked for many years to come.
I hope, therefore, that the Financial Secretary will say, even without commitment, that the Treasury will look carefully into the question of producing a differential rate of petrol duty to help the rural areas.

Mr. Paul Dean: This might be an appropriate moment for me to intervene, in particular, about Amendments Nos. 153, 154 and 155. These proposals deal with a rebate of fuel duty for various categories of disabled people, particularly those who have invalid carriages, vehicles which are adapted for their own use and vehicles which qualify for the disabled drivers' car badges as specified by the Ministry of Health.
As my hon. Friend the Member for Chelsea (Mr. Worsley) said, the case in favour of this gets stronger every time the fuel duty is increased. There are three main arguments in favour of a rebate for the disabled. The first is an obvious one; the steep increases which have taken place in the fuel duty in the last few years. It has increased by nearly 50 per cent. in the last three or four years and is one of many increases in the cost of living to have greatly affected disabled people. How much of the £900 million to be raised by the Bill will bear on disabled people?
The Prime Minister said clearly at the time of devaluation and when cuts in Government expenditure were announced that those most in need would be protected. Many of the people covered by this series of Amendments come within the category of people in need. There is no doubt that this increase in fuel duty, together with many other increases in the cost of living, will mean a decline in the standard of living of many disabled people. It is an odd way of fulfilling that pledge given by the Prime Minister. The Financial Secretary cannot possibly make out that there has not been a decline in the standard of living of a substantial number of disabled people.
The Financial Secretary will no doubt use the argument which has been produced whenever we have discussed this matter; that this subject should be dealt with not through the taxation system, but through the social service arrangements. While I accept that this is a somewhat clumsy way of trying to achieve our objective, it is the immediate way at our disposal to get action taken now. If the hon. Gentleman says that this should be done through the social services, then he should bear in mind that we have discussed disability pen-

sions on a number of occasions and that whenever we have put forward proposals along these lines the Government have said, "We are considering the matter" or "We must wait until more money is available". We have, as a result of this state of affairs, never been able to hope for early action on this matter. We are, therefore, seeking to bring immediate help for this category of people.
I hope that the hon. Gentleman will not use the argument that the proposal contained in Amendments Nos. 153, 154 and 155 would cost too much—

Mr. Harold Lever: Mr. Harold Lever indicated dissent.

Mr. Dean: —because he said in the Standing Committee that it would cost less than £1½ million a year. I am glad to note that the hon. Gentleman does not intend to use that argument.
The second main argument in favour of our proposal is the immense importance of mobility for disabled people. Those of us who are not disabled take mobility for granted. While we curse the traffic jams, we can at least travel by underground or walk. The disabled cannot. One of their most prized possessions is the means of mobility, for it helps them to lead a reasonably normal life—to get to their work, to the shops, to visit their relatives and friends and take part in recreational activities. Few aids to living are more important for the disabled than their means of mobility.
The third main argument in favour of our proposal is that these special vehicles can in no sense be regarded as a luxury, as my hon. Friend the Member for Chelsea pointed out. They are not an optional extra but are an essential part of the life of disabled people, many of whom depended completely for getting about on vehicles which have been especially adapted for them. In many instances these people cannot use buses or other public transport facilities. It is impossible for them to contract out of the increased fuel duty.
The importance of these points was brought home to me when I had the privilege earlier in the year of opening the spring fair of a disabled persons' motor club. It was wonderful to see the help that the club is providing for its members and for other disabled people. All those with whom I spoke said that


their number one priority was their means of transport. I trust that the pledges given by the Prime Minister will be implemented and that the Amendments will be accepted, for this is one means of implementing those pledges immediately. It would also be an excellent means for us to help those who are valiantly trying to help themselves.

5.00 p.m.

Mr. Harold Lever: We have had a very interesting debate, opened by the hon. Member for Worcestershire, South (Sir G. Nabarro), whose absence from the Standing Committee we all regretted. Many of us must have felt that he was one of the few Members who would have been heard without amplification, in spite of the somewhat unusual acoustic conditions that prevailed then. We are grateful to him for moving this Amendment with his accustomed moderation.
The points raised ought to be dealt with generally at first. The general atmosphere of criticism from the other side appears to be that there is an element of malice in the raising of this tax, an element of dislike of the motorist. The hon. Member for Ormskirk (Sir D. Glover) went so far as to say that we had an antipathy to the internal combustion engine. It seemed to be a remarkable antipathy to nurse. I am sure that I am achoing the feelings of every hon. Member, especially those on this side, when I welcome the hon. Member for Ormskirk back, and say that we rejoice in the fact that he is now in full health and showing, by the vigour of his chastisement of the Government, that he is unimpaired in his capacity to render service to the House.
To deal with his point first, we must get some simple facts clear. In the modern society, petrol is inevitably attractive as a means of raising indirect revenue, not only to members of this Government but to the previous Conservative Government. When the Conservative Government came in in 1951, the level of petrol tax was 1s. 10½d. Before they left office they had raised it to 2s. 9d. a gallon, an increase of merely 50 per cent. When we came in pertol tax was 2s. 9d. and we have raised it to 3s. 11d., a rather smaller percentage increase.

Mr. Victor Goodhew: A shorter time, too.

Mr. Lever: If we take the shorter time under the Conservatives we get an even worse effect. When hon. Members opposite were in power the tax was 1s. 10½d. When we take a much shorter time, say about five years, we find that in 1956 it was 3s. 6d. a gallon.

Sir G. Nabarro: Suez.

Mr. Lever: I did not know that the Suez group or the Suez Canal actually determined the rate of duty per gallon.

Sir G. Nabarro: The hon. Gentleman is historically wrong. He said five years after the Tory Government came in, in 1951—I am going slowly to allow him to collect his wits. Five years from 1951 is 1956, the autumn of that year. Suez took place in September, 1956, and the special Suez surcharge, in the form of an increased duty of 1s. a gallon was put on by my right hon. Friend the Member for Sutton Coldfield (Mr. Geoffrey Lloyd), the then Minister of Power, in 1956. It was later removed. That was entirely a temporary measure, and has nothing to do with the general matter. It is a most dishonest point.

Mr. Lever: The hon. Gentleman may lash himself into a fury, but the fact is that the Conservative Government, in 1956, increased the charge in one year by 42 per cent. The fact that they took it off later is beside the point of my argument. [HON. MEMBERS: "Oh."] Hon. Members must try to relate their arguments to reality, not to their internally nourished fantasies.
They complained that I was quoting the beginning and end of the Conservative Government's record over petrol duty. They thought that this was over a long period, and I have taken it over a short period. If one takes the unhappy incidents in the middle, whether they be Suez or anything else, the fact is that it was not those which raised the petrol duty. It was the Conservative Chancellor who raised it by 1s. a gallon in one year.

Mr. Nott: According to the hon. Gentleman's figures, during the last three or four years of the Labour Government the petrol duty has gone up by 1s. 2d., whereas when the Conservative Party was in power for three times that period it raised it by 10½d. over the same period. On those figures, I do not see what the hon. Gentleman has to boast about.

Mr. Lever: It may be that when we get these annual arguments after we have been in power for 13 years we will be able to show a similar proportion. I know that it is hard for hon. Members opposite to see the proportions, but, if one takes proportions, the percentage increase while the Conservatives were in power was getting on for 50 per cent. This does not cohere with the kind of argument made from the opposite side that there is malice or incompetence on the part of the Labour Government. During Conservative rule over 13 years there was a 50 per cent. increase in the duty. It is not unreasonable for me, therefore, to remind hon. Members opposite that any Government are liable to have recourse to some increase in duty to raise revenue.

Mr. Maude: The hon. Gentleman will surely concede that there is some difference between an annual increase of less than 4 per cent. and an annual increase of 15 per cent. or 16 per cent?

Mr. Lever: It did not work out as an annual increase of 15 per cent. It was, unhappily, much jerkier than that. I can understand that hon. Members opposite, in Committee on the Finance Bill, want to disclaim all responsibility for foreign policy decisions. I will not weary the Committee with the details, but hon. Gentlemen would be completely wrong in supposing that there was a gentle progression of that kind. Taking the first year of Conservative Government, they increased the duty from 1s. 10½d. to 2s. 6d., an increase of 7½d. or 30 per cent.
This is rather like the record of the present Government—the duty has gone up rather sharply at the beginning, but who knows, the rates of increase may decline in later years. The hon. Member must not delude himself into supposing that the Conservative 42 per cent. increase in duty took place at the rate of 4 per cent. per annum.

Mr. Maude: On average.

Mr. Lever: I am hoping that, on average, over the next 13 years of Labour Government, there will be a similar argument available to us, though not necessarily in opposition. This is a tax which inevitably has some effect on transport costs, but it is, fortunately, gradual and very small. In the cost-of-living index


it comes to one-tenth of one point, and that will be gradually achieved, at its peak effect. It is not a very startling increase on the cost of goods, and explains why the Conservative Party felt able to increase the duty by 42 per cent. or so.
The hon. Member for St. Ives (Mr. Nott) was at his most parochial today, and said that he did not care what petrol cost or what petrol duty was in other countries. But I must answer the debate, which concentrated on the competitive effect of the duty in terms of raising the price of petrol and of transport, even on export goods. If this is a decisive aspect of competitiveness, we are in a very competitive position. The cost of petrol per gallon in Portugal is 8s. 5d., in France it is 8s. 3d., in Italy it is 7s. 9½d., in Belgium it is 6s. 9d., in Norway it is 6s. 8d., in Denmark it is 6s. 5d., in Germany it is 6s., and in the United Kingdom, after the tax increase, it is between 5s. 9d. and 5s. 10d.

Mr. Nott: What is it in the Fiji Islands, which is just about as relevant to what we are debating?

Mr. Lever: If the hon. Gentleman thinks that the price of petrol in the Fiji Islands is exactly as relevant to the argument about export competitiveness as the price in France, Italy, Belgium, Norway, Germany and Holland, I must leave him to his own thoughts, because I am not in tune with them.

Sir G. Nabarro: Would the hon. Gentleman get on the same wavelength, if he wants to use this as an argument? I am with my hon. Friend the Member for St. Ives (Mr. Nott) in thinking that it is largely irrelevant, but, if he wants to use it, why not quote the comparison which is really valid? That is the comparison with the United States, where comparable petrol costs 2s. 4d. a gallon against 6s. here. He is making our petrol more and more uncompetitive for our exporters.

Mr. Lever: I was quoting what I thought was relevant. The hon. Gentleman may think that that comparison is more relevant, like the Fiji Islands. I do not know where the hon. Gentleman gets his figures, but the figures I have are that the comparable petrol cost 3s. 5½d. a gallon in the United States.



It is very much cheaper than it is here, for obvious reasons that are not very relevant to our discussions.

Mr. Ridsdale: Will the hon. Gentleman admit that in that country direct taxation is very much lower and the consumers have much more money to pay the increased prices?

Mr. Lever: Even I if I were prepared to admit that, it would not be true. If I detailed the comparative situation in terms of direct taxation, I should soon be called to order.
The fact is that this moderate increase in the price is not unfair in the circumstances of this year's Budget. Its effect on the cost of goods is tiny. Its effect on our competitiveness with other European countries can be judged from the level of petrol prices in those countries. In all the circumstances, the Governments' case must be that this is a reasonable increase, making its contribution to a substantial increase in taxation which unhappily was inevitable in the present circumstances. I expect on hosaanas of joy from any taxpayer, and motorists are no exceptiton, but I am afraid that this is a burden that must be borne and accepted.
The hon. Member for Ayr (Mr. Younger) asked that different rates should be considered for different parts of the country. On the face of it, that seemed to me impracticable, but I will have the idea looked at, without making any commitment. Perhaps I should not comment further than that.
I have every sympathy with those who want to help invalid carriage users and protect them against any increase in duty. Unhappily, no Government, including the Conservative Government when they increased petrol duty, have been able to find a way to shield particular users of this kind from the hardship or consequences of a petrol duty increase. The Amendment is impracticable. It could not be administered, and it could not be policed. There would be immense administrative problems.

Mr. Geoffrey Wilson: Am I not right in thinking that in the Transport Bill there is a provision to make a rebate to buses? Is it not possible to make a rebate to invalid carriage users?

5.15 p.m.

Mr. Lever: There is in this Bill provision for a rebate to buses. I am grateful to the hon. Gentleman for drawing attention to the point that we have shielded buses from the effect of the petrol duty increase. That is possible in the case of the relatively few large scale transport operators. It is certainly not possible to do it in the case of each invalid carriage users. I greatly regret this. It is not from any lack of sympathy that we cannot accede to the request, or, I suppose, that previous Conservative Governments could not accede to similar requests. I regretfully turn it down on the ground that its administration would be impossible and either grotesquely expensive in relation to what was granted or hopelessly badly policed.

The Temporary Chairman (Mr. Harold Gurden): Mr. Fortescue.

Mr. Maude: Before the hon. Gentleman sits down, will he deal with the question of the particular hardship to the rural areas?

The Temporary Chairman: Order. The hon. Gentleman had sat down. I called Mr. Fortescue.

Mr. Tim Fortescue: I am sorry that I was unable to catch the eye of the Chair before the Minister spoke, but perhaps in view of what he said that is just as well.
I have already learned in my brief experience in the House that there is not much future in appealing to the generosity, warmheartedness and open-handed affluence of any members of the Treasury team. This happens several times a year with monotonous regularity and the answer is always the same. I am sure that this is so whichever Government are in power. Therefore, it seems to me that the only way to try to persuade the hon. Gentleman of the virtue of the three Amendments dealing with invalid carriages is to persuade him that their acceptance would be in the Treasury's interests as regards money spending, and would not cost him anything. This I shall briefly try to do.
In the Health Services and Public Health Bill, which has just returned to the Commons from another place with a few Amendments, but no Amendment to the part of the Bill with which I am



now concerned, the Minister of Health, to the general acclamation of both sides of the Committee which dealt with the Bill, has taken powers under Clause 33(3), which states:
The Minister may, … make payments by way of grant towards costs incurred by any such person as is mentioned in subsection (1)"—
that is, people entitled to invalid carriages—
in relation to an invalid carriage or other vehicle provided by the Minister for or belonging to that person, that is to say, … the purchase of fuel for the purposes of the vehicle, …
The Financial Secretary has just said that this is impossible, that the administrative complications which would arise from helping the small numbers of individual people who run invalid carriages to pay for their fuel would be quite out of the question. Yet in another Bill before the House, unopposed by anybody, one of his right hon. Friends is taking powers to do so if he wishes. If he uses those powers, and makes grants to the operators of invalid carriages to help them with their fuel costs, the cumbersomeness of that method of paying for fuel will be far greater than the cumbersomeness of the proposals in the three Amendments.
The Minister of Health would have to pay out some money to the operators of invalid carriages to enable them to pay for their fuel, the cost of which includes the extra tax which is now being laid on them. Therefore, the money would be paid out by the Government with one hand and collected by them with the other. I know that this has been rather a favourite device of the Government in financial matters. We have only to consider the family allowances and the Selective Employment Tax which have been foisted on us by the Government to see that this is what they like doing.
I do not think that anybody in the Committee, even on the Government side, would pretend that it is a very tidy or easy way of collecting money. Therefore, I seriously suggest to the hon. Gentleman that he should look at the powers which his right hon. Friend has taken in the Health Services and Public Health Bill. He will then find that they are much more far-reaching and far more clumsy than anything suggested in the


Amendments, and that both from the point of view of economy of taxation and ease of administration it would befit him far better to accept our Amendments and thus obviate the necessity for his right hon. Friend to make the grants for fuel for invalid carriage operators which he proposes.

Mr. Michael Noble: I want to reinforce what has been said by a number of my hon. Friends and perhaps to encourage the Financial Secretary, who is coming at least a little way in our direction, to look even more seriously at some of these problems than he has indicated that he will do. I agree with my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) that the possession of a car today is of tremendous importance to a vast range of people. Twenty years ago, at the end of the war, people wanted houses. Now, due to the successful Conservative housing policy, they have their houses and want cars. In most parts of the country, including, I am sure, the Financial Secretary's constituency, the number of cars has probably doubled, trebled or quadrupled over the last 12 or 13 years. It is what people want. It is the modern way of moving around.
But I hope that some time the hon. Gentleman will stay a few days with me in the wilds of Argyll. He will see that exactly the same thing has happened there but for quite different reasons, in that people must have motor vehicles if they are to live any sort of modern life at all. We have practically no railways and few buses, which are irregular in timing. There is no other way of getting around apart from cars, and if we are to keep people in such areas it is a strange paradox that they must be able to get away if they are to be prepared to stay. Cars in such areas are essential.
It is not really surprising, although it often does come as a surprise to people, that the Island of Orkney has, I believe, the highest density of cars in Europe. One would not expect this of a Scottish island but I believe that it is still true. It was certainly true a few years ago when I checked the figures. In these areas, there are practically no railways or rural bus services. Only private cars are available for people to be able to move about.
One of the aspects I have found a little disturbing—and I am not quarrelling with the hon. Gentleman's figures, because I am sure he is right—is the attitude that, if we put up the cost of petrol, it puts only one-tenth of 1 per cent. on the price of goods. This is disturbing because, for the first time in my life, in the Western Highlands there are a very large number of vans going between the local villages on journeys of 60 or 70 miles a day delivering goods but the owners are saying that they can no longer continue to do so and are taking their services off. The hon. Gentleman might say that this is not purely because of the cost of petrol. It is also, of course, because of the Selective Employment Tax, the increased vehicle licence duty and other increases imposed by the Government.

Mr. Harold Lever: I hope I did not, by a slip of the tongue, say one-tenth of 1 per cent. on the cost of goods. It is one-tenth of one point on the cost-of-living index which results from the increase in petrol duty.

Mr. Noble: I am grateful to the hon. Gentleman. I took it to be the other. But I have raised this point with the Scottish Office and it has given me this sort of figure. It says that it is only a tiny percentage. But there is an accumulation of tiny percentages which have been imposed steadily over the last three or four years since the Socialists came to power, and it has fundamentally changed the view of many distributors and suppliers in the outlying areas. If these people go, as they are going, what is the rest of the community to do?
There is only one alternative. The people in these areas must use their own cars more regularly for much greater distances. In my constituency, people regularly drive 60 or 80 miles. I can go 100 miles in one direction and 160 in another by road without leaving my constituency. People must go long distances for their food and drink, and if all these extra costs mean the withdrawal of distribution services, then the only alternative is, for them to drive very long distances at weekends or whenever they can in order to obtain the things they need for their ordinary existence.
There is a good fundamental case for the Treasury to consider carefully the problems of differential taxation for the


areas of large distances in the rural parts of the country. The case is particularly valid for a number of islands, where the cost of petrol is often 6d. or more a gallon greater than elsewhere because of the problems of distribution. I hope that the hon. Gentleman will look at this again and will bring in some effective legislation to put the matter right at an early date.
I do not feel entirely sympathetic with a Government who, having promised no extra taxation, have, even if only for a short period of three or four years, increased petrol duty and distribution costs so vastly. I congratulate my hon. Friend the Member for Worcestershire, South on raising this point and I feel strongly in support of his case.

Mr. Goodhew: Had I not seen it with my own eyes, I would never have believed the strange transformation of the hon. Member for Manchester, Cheetham (Mr. Harold Lever) from the back benches to the position of Financial Secretary to the Treasury. When he sat on the back benches, he was full of reasonableness and understanding. He was constantly attacking Treasury thinking and was full of common sense. Now that he has moved a few feet up the Chamber, he has suddenly absorbed the spirit of the Treasury almost to the point of callousness. He has been reduced from his old common sense to the tortuous arguments and juggling with figures of the Treasury.
The figures which the hon. Gentleman gave will not wash. We are not talking about an isolated example of an increase in taxation. He is clobbering the motorist this time. Not only is there 4d. a gallon on petrol but £7 10s. a year on the vehicle licence duty—an increase of 43 per cent. If he claims that the Government are less harsh on the motorist than the Conservatives were, he should look at it in the context of the Bill and see what the Government are doing to the running costs of the average man's car, many of which do quite small mileages a year. To these people, the additional cost of petrol and licence duty will make a great difference.
The hon. Gentleman also ignores the fact that, when previous increases were made, it was at a time when direct taxation was being reduced. That makes a great difference. Someone who brings home more money in his pay packet is



thus left with a better opportunity of deciding his own priorities in spending. But the Government have increased direct taxation as well as indirect taxation, on petrol in particular, while telling us that we must not have increased incomes to enable us to afford it.
I mentioned in Committee upstairs the aircraft workers in my constituency, many of whom must use cars in order to get to the Handley Page Works at Rad-lett, just inside my constituency, or to the Hawker Siddeley Works at Hatfield, just outside it. No doubt, when asking for pay increases to help meet extra costs, they will come up against the Prices and Incomes Bill. This is quite a different atmosphere in which to talk about increases in taxation. I wonder if he considers the commuters who live in a constituency like St. Albans. The trains are not very comfortable—[AN HON. MEMBER: They catch fire!]—They catch fire from time to time. This has caused a great deal of concern among my constituents, and has caused them to want to motor.
5.30 p.m.
The line is overcrowded and the rolling stock is uncomfortagle. Many of my constituents choose to motor part of the way in, which is what they have been asked to do. If their work takes them to a point well south of St. Pancras, it is much more convenient for them to motor part of the way in and pick up the underground, instead of going to St. Pancras by train and then on to the underground. These people will all suffer. They will suffer these increases at a time when the Government are showing a determination that they should not have increased incomes to enable them to afford it.
The same applies to those who have to motor their children to school. Parents work on a roster system by which they collect three or four children in one car and take them all to school. They have to do it, because there are no bus services in rural areas, and in many cases the education authority will not provide school buses. These people will be asked to pay the extra impost, and all because the Financial Secretary says that petrol is an attractive means of collecting revenue.
It is a great mistake for the Government to consider that the motorist is


somebody who is there to be clobbered and who can always be forced to pay more. There is a law of diminishing returns, and many motorists work on a narrow margin. The margin between being able to afford to run a motor car and having to pack it up all together is a very narrow one. If many people are driven off the roads, the Financial Secretary will be faced with the difficulty of providing public services, which will be much more expensive to the Government. I hope that he will think seriously about this before Report stage, although, as I say, the transformation which has come over him since he has moved from the back bench leads me to think that that is a faint hope.

Mr. Iain Macleod: Before my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) wraps up this very valuable and important debate, I would draw the attention of the Financial Secretary to one point on Amendments Nos. 153, 154 and 155, which are being discussed with Amendment No. 1—the three Amendments which suggest that differential and favourable treatment should be given to those who are invalid or disabled and who have to use an appropriate form of transport.
The Financial Secretary was sympathetic to the idea behind those proposals, as are all hon. Members on both sides of the Commmittee. He advanced two arguments against them, The first was that the idea was impracticable, and the second was that it could not be policed. I should like to put to the Commmittee very shortly that both those propositions are wrong.
On the question of whether it be impracticable or not, the class of person that we are considering does not have to pay vehicle excise duty and can obtain a certificate to this effect for display. It is quite true that the classes of people that we are trying to help are not exactly co-terminus with that group, but it is a very poor argument to say that one declines to help a most deserving group of people because one cannot be quite sure that one is helping all of them. Beyond argument there is in the system of exemption from excise duty a method of identification which is available to the Treasury. The problem of giving special help in the social services,



wherever it may be, is basically a question of identification. We know who are and who are not disabled, and, therefore, identification cannot be a problem which could stand in our way if the will to help these people is there.
I turn to the second point, that it cannot be policed, and that if coupons for a cheaper form of petrol were given to disabled drivers it might lead to the same sort of abuse that unquestionably happened with tobacco coupons for old age pensioners. There is a profound difference between the two. Coupons for tobacco were given to people, whether or not they smoked, as long as they asked for them, and many people who did not smoke were more than happy to give their coupons away. That position does not arise here. People are not disabled because they want to be disabled. They are disabled for any one of a hundred reasons. It is part of the tragedy of their lives and it is inconceivable to think that coupons issued to a disabled person would be traded for the gain of a penny or two that could come from letting somebody else have them.
In this context I pick up a point made by the Chancellor of the Exchequer in his Budget speech. When he spoke about increases in taxation he said that for many people there was at least an alternative; that is to say, instead of paying the higher prices they could save the money. This is an absolutely valid argument for drinking spirits and for smoking, but it is not a valid argument for petrol for disabled drivers. They literally have no choice in these matters, unless they are prepared to vegetate in their homes, and we all know that the one thing above all others that is vital for disabled people is to keep them, as far as possible, in the full flow of ordinary life.
I am quite certain that the argument about policing has no validity. The argument about it being impracticable is, I concede, a little more difficult, but nothing like as difficult as has been claimed, in view of the exemptions from vehicle excise duty that already obtain.
I do not want to go into the party political side of this argument, because it is an argument that appeals very much to both sides of the House, but an undertaking was given by the Prime Minister that people most afflicted, would on the whole, as far as it could be done, not


suffer from devaluation. Unless something like this is done, that part of that pledge is broken. So, between now and Report stage, I ask the Financial Secretary to reflect again on the two points: is it practicable, and can it be policed? I have a feeling that he could well come to the House on Report with a more helpful answer than he was able to give today.

Sir G. Nabarro: I am grateful to my right hon. Friend for referring to this as a valuable and important debate. Indeed, it has been a most one-sided debate. The voices of 18 of my right hon. and hon. Friends have been raised in support of mine in condemning this iniquitous increase in the motor spirit duty. Not a single voice, other than that of the Financial Secretary, has been heard from the benches Opposite. All of this adds weight to the most propitious and apposite comment of my hon. Friend the Member for Ormskirk (Sir D. Glover), that Socialists have some antipathy towards the internal combustion engine; they do not like it. They are envious of people with motor cars, they regard motor cars as the perquisites of the Tory rich.
They will find out to the contrary at the next General Election. The motorists' vote in this country is critically important. I have recognised it since I entered politics. That is why I have always championed the motorist, and look where I have got. There are 10½ million of them today, and they are growing apace. They utterly resent the continuous and penal increases in the three related forms of taxation heaped upon them by the Socialist Administration since the autumn of 1964.
I intend to castigate the Financial Secretary in the mildest terms for his behaviour today. It was rankly dishonest when he said that, in the first five of their 13 years, the Tory Government increased the petrol duty by more than the Socialists have increased it in the last four years. I have quickly calculated five years forward from October, 1951, to October, 1956, having realised that the shilling per gallon Suez special premium was put on in the autumn of 1956 for a few short weeks to act as a special rationing measure in the extraordinary difficulties of those months, and removed very shortly thereafter. It is as dishonest



to calculate the shilling premium arising from Suez into petrol duties as it would be to say that unemployment in 1947 was 2·2 million due to the extraordinary behaviour of the right hon. Member for Easington (Mr. Shinwell). Of course, it was not his fault that every factory in the country shut down, and I have never suggested that it was—much.
It is just about as dishonest to calculate that into the general argument that was used by the Financial Secretary. Over 13 years between 1951 and 1964, my party demonstrated that it was the friend of the British motorist. I do not want to anticipate what I shall have to say on a further selected Amendment on Purchase Tax and other aspects of taxation, and this is only a passing reference, but it was the Tories who reduced the Purchase Tax on cars from 60 per cent. to 25 per cent. It is the Socialists who have put it in reverse. I remember my right hon. Friend the Member for Barnet (Mr. Maudling), on Guy Fawkes' Day in 1962, bringing Purchase Tax on motor cars down from 50 per cent. to 25 per cent. in one go— the motorist's friend indeed. It was my party which said that the licence duty on cars was far too high at 25s. per horse power and made it uniform at £10 per car. Where has it gone now? First, it went to £17 10s., and now to £25—

The Temporary Chairman: Order.

Sir G. Nabarro: A passing reference only, Mr. Gurden.

The Temporary Chairman: I thought that we had already passed the reference. Let us come back to the petrol duty.

Sir G. Nabarro: I was endeavouring to demonstrate that the three aspects of taxation on motor cars are interdependent. I know that we are only discussing the petrol duty, but my party drastically brought down Purchase Tax on cars, drastically brought down the vehicle licence duty and, over 13 years, very mildly increased petrol duty. The party opposite has increased the vehicle licence duty—

Mr. Harold Lever: On a point of order, Mr. Gurden. I do not in the least mind these passing references, but, as I have denied myself similar references to matters wholly unrelated to the Amendment, I must ask you whether it would


be in order for me to deal with the comments made about the Purchase Tax on cars, vehicle licence duties and other matters in a further reply.

The Temporary Chairman: I had already reminded the hon. Member for Worcestershire, South (Sir G. Nabarro) of this, and I allowed other hon. Members to make passing references. No doubt the hon. Gentleman will now come back to the Amendment.

5.45 p.m.

Sir G. Nabarro: Mr. Gurden, I apologise. I was endeavouring to demonstrate the friend that my party is towards the motorist in every sense, whereas the party opposite is the enemy of the motorist, and 10½ million car owners in the country would do well to recognise that simple fact of life.
In the 12 months to 31st March, 1964, which was the last full year of Tory Government, the sum raised from road users in all forms of taxation was £777 million. In the 12 months to 31st March, 1969, the sum budgeted for is £1,561 million—

Mr. Gardner: It will be well spent.

Sir G. Nabarro: The hon. Member for Rushcliffe (Mr. Gardner) supports it, and HANSARD will record the fact tomorrow. Under Socialist administration, taxation on the motorist has more than doubled. That may be the policy of right hon. and hon. Gentlemen opposite. If it is, it is a very bad one, and the nation will condemn it. Indeed, it is a cardinal reason for the disastrous results at the polls of the party opposite in municipal elections and Parliamentary by-elections. A huge burden of additional taxation has been heaped on the motorist. That is why I am so proud to stand here as the friend of the British motorist—

Mr. James Dempsey: Listen to the chairman of the club.

Sir G. Nabarro: The hon. Member for Coatbridge and Airdrie (Mr. Dempsey) may jibe, but at least I drive a British car.

Mr. Dempsey: I do not drive any car.

Sir G. Nabarro: I know. I doubt whether the hon. Gentleman even has a


driving licence. Mr. Gurden, it is fortunate that this has been the first Amendment selected. I now make an appeal to you. We have two important issues to decide. Amendment No. 1 deals with the general proposition that the duty on motor spirit should be increased not by 4d. a gallon but by only 1d. The other three Amendments deal with the important matters raised by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) about disablement. If we cannot have separate Divisions on those two issues, may I recommend to

Division No. 216.]
AYES
[5.49 p.m.


Alison, Michael (Barkston Ash)
Godber, Rt. Hn. J. B.
Nott, John


Astor, John
Goodhart, Philip
Osborn, John (Hallam)


Atkins, Humphrey (M't'n &amp; M'd'n)
Goodhew, Victor
Page, Graham (Crosby)


Awdry, Daniel
Gower, Raymond
Page, John (Harrow, W.)


Baker, Kenneth (Acton)
Grant-Ferris, R.
Pearson, Sir Frank (Clitheroe)


Baker, W. H. K. (Banff)
Griffiths, Eldon (Bury St. Edmunds)
Peel, John


Bell, Ronald
Hall, John (Wycombe)
Peyton, John


Bennett, Sir Frederic (Torquay)
Hall-Davis, A. G. F.
Pink, R. Bonner


Bennett, Dr. Reginald (Gos. &amp; Fhm)
Hamilton, Lord (Fermanagh)
Pounder, Rafton


Berry, Hn. Anthony
Hamilton, Michael (Salisbury)
Powell, Rt. Hn. J. Enoch


Biffen, John
Harrison, Col. Sir Harwood (Eye)
Price, David (Eastleigh)


Biggs-Davison, John
Harvie Anderson, Miss
Prior, J. M. L.


Birch, Rt. Hn. Nigel
Hastings, Stephen
Pym, Francis


Black, Sir Cyril
Hawkins, Paul
Quennell, Miss J. M.


Blaker, Peter
Heald, Rt. Hn. Sir Lionel
Rawlinson, Rt. Hn. Sir Peter


Boardman, Tom (Leicester, S.W.)
Heath, Rt. Hn. Edward
Rees-Davies, W. R.


Body, Richard
Higgins, Terence L.
Renton, Rt. Hn. Sir David


Bossom, Sir Clive
Hiley, Joseph
Ridley, Hn. Nicholas


Boyle, Rt. Hn. Sir Edward
Hill, J. E. B.
Ridsdale, Julian


Brinton, Sir Tatton
Hirst, Geoffrey
Rodgers, Sir John (Sevenoaks)


Brown, Sir Edward (Bath)
Hogg, Rt. Hn. Quintin
Rossi, Hugh (Hornsey)


Bruce-Gardyne, J.
Holland, Philip
Royle, Anthony


Bryan, Paul
Hordem, Peter
Russell, Sir Ronald


Buck, Antony (Colchester)
Hornby, Richard
St. John-Stevas, Norman


Bullus, Sir Eric
Howell, David (Guildford)
Scott, Nicholas


Campbell, B. (Oldham, W.)
Hunt, John
Scott-Hopkins, James


Campbell, Gordon (Moray &amp; Nairn)
Hutchison, Michael Clark
Sharples, Richard


Carr, Rt. Hn. Robert
Iremonger, T. L.
Shaw, Michael (Sc'b'gh &amp; Whitby)


Chichester-Clark, R.
Jenkin, Patrick (Woodford)
Silvester, Frederick


Clark, Henry
Jopling, Michael
Sinclair, Sir George


Clegg, Walter
Kaberry, Sir Donald
Smith, Dudley (W'wick &amp; L'mington)


Cooke, Robert
Kershaw, Anthony
Smith, John (London &amp; W'minster)


Cooper-Key, Sir Neill
Kimball, Marcus
Speed, Keith


Cordle, John
King, Evelyn (Dorset, S.)
Stainton, Keith


Corfield, F. V.
Knight, Mrs. Jill
Steel, David (Roxburgh)


Costain, A. P.
Lancaster, Col. C. G.
Stoddart-Scott, Col. Sir M. (Ripon)


Cradciock, Sir Beresford (Spelthorne)
Lane, David
Summers, Sir Spencer


Cunningham, Sir Knox
Langford-Holt, Sir John
Tapsell, Peter


d'Avigdor-Goldsmid, Sir Henry
Lewis, Kenneth (Rutland)
Taylor, Frank (Moss Side)


Dean, Paul (Somerset, N.)
Lloyd, Ian (P'tsm'th, Langstone)
Temple, John M.


Deedes, Rt. Hn. W. F. (Ashford)
Lloyd, Rt. Hn. Selwyn (Wirral)
Thatcher, Mrs. Margaret


Digby, Simon Wingfield
Loveys, W. H.
Thorpe, Rt. Hn. Jeremy


Dodds-Parker, Douglas
Lubbock, Eric
Tilney, John


Doughty, Charles
MacArthur, Ian
Turton, Rt. Hn. R. H.


Douglas-Home, Rt. Hn. Sir Alec
Maekenzie, Alasdair (Ross&amp;Crom'ty)
Wainwright, Richard (Coine Valley)


Drayson, G. B.
Maclean, Sir Fitzroy
Walker-Smith, Rt. Hn. Sir Derek


Eden, Sir John
Macleod, Rt. Hn. lain
Walters, Dennis.


Elliot, Capt. Walter (Carshalton)
McMaster, Stanley
Ward, Dame Irene


Elliott,R.W.(N'c'tle-upon-Tyne,N.)
Maddan, Martin
Webster, David


Emery, Peter
Maginnis, John E.
Whitelaw, Rt. Hn. William


Errington, Sir Eric
Marten, Neil
Williams, Donald (Dudley)


Eyre, Reginald
Maude, Angus
Wills, Sir Gerald (Bridgwater)


Farr, John
Mawby, Ray
Wilson, Geoffrey (Truro)


Fletcher-Cooke, Charles
Maxwell-Hyslop, R. J.
Winstanley, Dr. M. P.


Fortescue, Tim
Maydon, Lt.-Cdr. S. L. C.
Wolrige-Gordon, Patrick


Foster, Sir John
Mills, Peter (Torrington)
Woodnutt, Mark


Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
Mills, Stratton (Belfast, N.)
Worsley, Marcus


Galbraith, Hn. T. G.
Monro, Hector
Wylie, N. R.


Gibson-Watt, David
Morrison, Charles (Devizes)
Younger, Hn. George


Gilmour, Ian (Norfolk, C.)
Munro-Lucas-Tooth, Sir Hugh



Gilmour, Sir John (Fife, E.)
Murton, Oscar
TELLERS FOR THE AYES:


Glover, Sir Douglas
Nabarro, Sir Gerald
Mr. Jasper More and


Glyn, Sir Richard
Noble, Rt. Hn. Michael
Mr. Anthony Grant.

my right hon. and hon. Friends that they record their disapproval of the Government's policies by supporting Amendment No. 1, and then dividing on the Question, "That the Clause stand part of the Bill"? That will demonstrate that we wish to register our disapproval under both those headings.

Question put, That the Amendment be made:—

The Committee divided: Ayes 185. Noes 247.

NOES


Albu, Austen
Greenwood, Rt. Hn. Anthony
Moyle, Roland


Allaun, Frank (Salford, E.)
Gregory, Arnold
Mulley, Rt. Hn. Frederick


Alldritt, Walter
Grey, Charles (Durham)
Murray, Albert


Anderson, Donald
Griffiths, David (Rother Valley)
Neal, Harold


Armstrong, Ernest
Griffiths, E. (Brightside)
Newens, Stan


Atkins, Ronald (Preston, N.)
Griffiths, Rt. Hn. James (Llanelly)
Noel-Baker, Rt. Hn. Philip (Derby,S.)


Atkinson, Norman (Tottenham)
Griffiths, Will (Exchange)
Norwood, Christopher


Bagier, Gordon A. T.
Hamilton, James (Bothwell)
Oakes, Gordon


Barnett, Joel
Hamilton, William (Fife, W.)
Ogden, Eric


Baxter, William
Hamling, William
O'Malley, Brian


Beaney, Alan
Hannan, William
Orme, Stanley


Bence, Cyril
Harper, Joseph
Oswald, Thomas


Benn, Rt. Hn. Anthony Wedgwood
 Harrison, Walter (Wakefield)
Owen, Will (Morpeth)


Bennett, James (G'gow, Bridgeton)
Haseldine, Norman
Page, Derek (King's Lynn)


Bidwell, Sydney
Hattersley, Roy
Palmer, Arthur


Bishop, E. S.
Hazeil, Bert
Pannell, Rt. Hn. Charles


Blackburn, F.
Heifer, Eric S.
Park, Trevor


Blenkinsop, Arthur
Henig, Stanley
Parker, John (Dagenham)


Boardman, H. (Leigh)
Herbison, nt. Hn. Margaret
Parkyn, Brian (Bedford)


Booth, Albert
Hilton, W. S.
Pavitt, Laurence


Bottomley, Rt. Hn. Arthur
Horner, John
Pearson, Arthur (Pontypridd)


Boyden, James
Houghton, Rt. Hn. Douglas
Pentlands, Norman


Braddock, Mrs. E. M.
Howarth, Harry (Wellingborough)
Perry, Ernest G. (Battersea, S.)


Bradley, Tom
Howarth, Robert (Bolton, E.)
Perry, George H. (Nottingham, S.)


Brooks, Edwin
Hoy, James
Price, Thomas (Westhoughton.)


Brown, Hugh D. (G'gow, Provan)
Huckfield, Leslie
Probert, Arthur


Brown, Bob (N'c'tle-upon-Tyne,W.)
Hughes, Emrys (Ayrshire, S.)
Randall, Harry


Brown, R. W. (Shoreditch &amp; F'bury)
Hughes, Roy (Newport)
Rankin, John


Buchan, Norman
Hunter, Adam
Rees, Merlyn


Buchanan, Richard (G'gow, Sp'burn)
Hynd, John
Reynolds, Rt. Hn. G. W.


Butler Herbert (Hackney, C.)
Irvine, Sir Arthur (Edge Hitt)
Richard, Ivor


Callaghan Rt. Hn. James
Jackson, Colin (B'h'se &amp; Spenb'gh)
 Roberts, Albert (Normanton)


Cant, R.B.
Jackson, Peter M. (High Peak)
Roberts, Gwilym (Bedfordshire, S.)


Carniichael, Neil
Jeger George (Goole)
Robertson, John (Paisley)


Carter-Jones, Lewis
Jenkins, Rt. Hn. Roy (Stechford)
Robinson, Rt. Hn. Keinneth (St.P'c'as)


Coe Denis
Johnson, Carol (Lewieham, S.)
Robinson, W. O. J. (Walth'stow,E.)


Cole'man, Donald
Johnson, James (K'ston-on-Hull W.)
Rodgers, William (Stockton)


Concannon, J. D.
Jones, J. Idwal (Wrexham)
Rogers, George (Kensington, N.)


Conlan Bernard
Jones, T. Alec (Rhondda, West)
Ross, Rt. Hn. William


Crawshaw, Richard
Judd, Frank
Shaw, Arnold (llford, S.)


Cronin John
Kelley, Richard
Sheldon, Robert


Crosland, Rt. Hn. Anthony
Kenyon, Clifford
Shinwell, Rt. Hn. E.


Crossman, Rt. Hn. Richard
Kerr, Mrs. Anne (R' ter &amp; Chatham)
short, Rt. Hn. Peter (Stepney)


Collen, Mrs. Alice
Kerr, Russell (Feitham)
Srlkin, Rt. Hn. John (Deptford)


Dalyell, Tarn
Lawson, George
Silverman, Julius


Darling, Rt. Hn. George
Leadbitter, Ted
Slater, Joseph


Davies, G. Elfed (Rhondda, E.)
Ledger, Ron
Small, William


Davies, Dr. Ernest (Stretford)
Lee, Rt. Hn. Frederick (Newton)
Snow, Julian


Davies, Harold (Leek)
Lee, John (Reading)
Spriggs, Leslie


Davies, Ifor (Gower)
Lester, Miss Joan
Stewart, Rt. Hn. Michael


Dempsey, James
Lever, Harold (Cheetham)
SummerskillHn. Dr. Shirley


Dewar, Donald
Lewis, Ron (Carlisle)
Swain, Thomas


Diamond, Rt. Hn. John
Lipton, Marcus
Symonds, J. B.


Dickens, James
Lomas, Kenneth
Taverne, Dick


Dobson, Ray
Loughlin, charles
Thomas, Rt. Hn. George


Doig, Peter
Loard, Evan



Dunn, James A.
Lyon, Alexander W. (York)
Thornton, Earnest


Dunnett, Jack
Lyons, Edward (Bradford, E.)
Tinn, James


Dunwoody, Mrs. Gwyneth (Exeter)
Maccoll, James
Tuck, Raphael


Dunwoody Dr. John (F'th &amp; C'b'e)
M acdonald, A.H.
Urwin, T.W.


Eadie, Alex
McGuire, Michael
Varley, Eric G.



Mckay, Mrs. Margreat
Wainwright, Edwin (Dearne Valley)


Edelman, Maurice
Mackenzie, Gregor (Ruthergien)
Wainwright, Edwin (Dearne Valley)


Edwards, Robert (Bilston)
Mackenzie, Gregor (Ruthergien)
Walker, Harold (Doncaster)


Edwards, William (Merioneth)
McMillan, Tom (Glasgow, C.)
Wallace, George


Ellis, John
McNamara, J. Kevin
Watkins, David (Consett)


Ennals, David
McNamara, J. Kevin



Ensor, David
MacPherson, Malcolm
Watkins, Tudor (Brecon &amp; Radnor)


Evans, Albert (Islington, S.W.)
Mahon, Peter (Preston, S.
Wellbeloved,James


Evans, Loan L. (Birm'h'm, Yardley)
Mallalieu, J.P.W. (Huddersfield, E.)
Wells, William (Walsall, N.)


Faulds, Andrew
Manuel, Archie
whitaker, Ben


Fitch, Alan (Wigan)
Marks, Kenneth
White, Mrs. Eirene


Fletcher, Raymond (Likeston)
Marquand, David
Wilkins, W.A.


Fletcher, Ted (Darlington)
Mason, Rt. Hn. Roy
Williams, Alan (Swansea, W.)


Foot, Rt. Hn. Sir Dingle (Ipswich)
Maxwell, Robert
Williams, Alan Lee (Hornchurch)



Mayhew, Christopher
Williams, Clifford (Abertillery)


Foot, Michael (Ebbw Vale)
Mikardo, lan
Williams, Mrs. Shirley (Hitchki)


Forrester, John
Millan, Bruce
Willis, Rt. Hn. George


Fraster, John (Norwood)
Milne, Edward (Blyth)
Winnick, David


Freeson, Reginald
Mitchell, R. C. (S'th'pton, Test)
Woodburn, Rt. Hn. A.


Galpern, sir Myer
Moonman, Eric
Woof, Robert


Gardner, Tony
Morgan, Elystan (Cardiganshire)



Garrett, W. E.
Morris, Alfred (Wythenehawe)
TELLERS FOR THE NOES:


Gordon Walker, Rt. Hn. P. C.
Morris, Charles R. (Openshaw)
Mr. John McCann and


Gray, Dr. Hugh (Yarmouth)
Morris, John (Aberavon)
Mr. Neil McBride.

Question, That the Clause stand part of the Bill put forthwith pursuant to Order [11th June]:—

Division No. 217.]
AYES
[5.58 p.m.


Albu, Austen
Garrett, W. E.
Mayhew, Christopher


Allaun, Frank (Salford, E.)
Gordon Walker, Rt. Hn. P. C.
Mikardo, Ian


Alldritt, Walter
Gray, Dr. Hugh (Yarmouth)
Millan, Bruce


Anderson, Donald
Greenwood, Rt. Hn. Anthony
Milne, Edward (Blyth)


Armstrong, Ernest
Gregory, Arnold
Mitchell, R. C. (S'th'pton, Test)


Atkins, Ronald (Preston, N.)
Grey, Charles (Durham)
Moonman, Eric


Atkinson, Norman (Tottenham)
Griffiths, David (Rother Valley)
Morgan, E;ystan (Cardiganshire)


Bagier, Gordon A. T.
Griffiths, E. (Brightside)
Morris, Alfred (Wythenshawe)


Barnett, Joel
Griffiths, Rt. Hn. James (Llanelly)
Morris, Charles R. (Openshaw)


Baxter, William
Griffiths, Will (Exchange)
Morris, John (Aberavon)


Beaney, Alan
Hamilton, James (Bothwell)
Moyle, Roland


Bence, Cyril
Hamilton, William (Fife, W.)
Muiley, Rt. Hn. Frederick


Benn, Rt. Hn. Anthony Wedgwood
Harmling, William
Murray, Albert


Bennett, James (G'gow, Bridgeton)
Hannan, William
Neal, Harold


Bidwell, Sydney
Harper, Joseph
Newens, Stan


Bishop, E. S.
Harrison, Walter (Wakefield)
Noel-Baker,Rt.Hn.PhiIip(Derby,S.)


Blackburn, F.
Haseldine, Norman
Norwood, Christopher


Blenkinsop, Arthur
Hattersley, Roy
Oakes, Gordon


Boardman, H. (Leigh)
Hazell, Bert
Ogderl, Eric


Booth, Albert
Heffer, Eric S.
O'Maley, Brian


Bottomley Rt. Hn. Arthur
Henig, Stanley
Orme, Stanley


Boyden, James
Herbison, Rt. Hn. Margaret
Oswald, Thomas


Braddock, Mrs. E. M.
Hilton, W. S.
Owen, Will (Morpeth)


Bradley, Tom
Homer, John
Page, Derek (King's Lynn)


Brooks, Edwin
Houghton, Rt. Hn. Douglas
Palmer, Arthur


Brown,Bob(N'c'tle-upon-Tyne,W.)
Howarth, Harry (Welingborough)
Pannell, Rt. Hn. Charles


Brown, R. W. (Shoreditch &amp; F'bury)
Howarth, Robert (Bolton, E.)
Park, Trevor


Buchan, Norman
Hoy, James
Parker, John (Dagenham)


Buchanan, Richard (G'gow, Sp'bum)
Huckfield, Leslie
Parkyn, Brian (Bedford)


Butler, Herbert (Hackney, C.)
Hughes, Emrys (Ayrshire, S.)
Pavitt, Laurence


Callaghan, Rt. Hn. James
Hughes, Roy (Newport)
Pearson, Arthur (Pontypridd)


Cant, R. B.
Hunter, Adam
Pentland, Norman


Carmichael, Neil
Hynd, John
Perry, Ernest G. (Battersea, S.)


Carter-Jones, Lewis
Irvine, Sir Arthur (Edge Hill)
Perry, George H. (Nottingham, S.)


Coe, Denis
Jackson, Colin (B'h'se &amp; Spenb'gh)
Prlce, Thomas (Westhoughton)


Coleman, Donald
Jackson, Peter M. (High Peak)
Probert, Arthur


Concannon, J. D.
Jeger, George (Goole)
Randall, Harry


Conlan, Barnard
Jenkins, Rt. Hn. Roy (Stechford)
RanKin, John


Crawshaw Richard
Johnson, Carol (Lewisham, S.)
Rees, Merlyn


Cronin, John
Johnson, James (K'ston-on-Hull W.)
Reynolds, Rt. Hn. G. W.


Crosland, Rt. Hn. Anthony
Jones, J. Idwal (Wrexham)
Richard, Ivor


Crossman, Rt. Hn. Richard
Jones, T. Alec (Rhondda, West)
Roberts, Albert (Normartton)


Cullen, Mrs. Alice
Judd, Frank
Roberts, Cwilym (Bedfordshire, S.)


Dalyell, Tam
Relief Richard
Robertson, John (Paisley)


Darling, Rt. Hn. George
Kenyon, Clifford
Robinson,Rt.Hn.Kenneth(St P'c'as)


Davies, G. Elfed (Rhondda, E.)
Kerr, Mrs. Anne (R'ter &amp; Chatham)
Robinson W. O. J. (walth'stow, E.)


Davies, Dr. Ernest (Stretford)
Kerr, Russell (Feitham)
Rodgers, William (Stockton)


Davies, Harold (Leek)
Lawson, George
Rogers, George (Kensington, N.)


Davies, I for (Gower)
Leadbitter, Ted
Ross, Rt. Hn. William


Dempsey, James
Ledger, Ron
Shaw, Arnold (Illford, S.)


Dewar, Donald
Lee, Rt. Hn. Frederick (Newton)
Sheldon, Robert


Diamond, Rt. Hn. John
Lee, John (Reading)
Shinwell, Rt. Hn. E.


Dickens, James
Lestor, Miss Joan
Shore, Rt. Hn. Peter (Stepney)


Dobson, Ray
Lever, Harold (Cheetham)
Silkin, Rt. Hn. John (Deptford)


Doig, Peter
Lewis, Ron (Carlisle)
Silverman, Julius


Dunn, James A.
Lipton, Marcus
Slater, Joseph


Dunnett, Jack
Lomas, Kenneth
Small, William


Dunwoody, Mrs. Cwyneth (Exeter)
Loughln, Charles
Snow, Julian


Dunwoody, Dr. John (F'th &amp; C'b'e)
Luard, Evan
Spriggs, Leslie


Eadie, Alex
Lyon, Alexander W. (York)
Summerskill, Hn. Dr. Shirley


Edelman, Maurice
Lyons, Edward (Bradford, E.)
Swain, Thomas


Edwards, Robert (Bilston)
McCann, John
Symonds, J. B.


Edwards, William (Merioneth)
MacColl, James
Taverne, Dick


Ellis, John
Macdonald, A. H.
Thomas, Rt. Hn. George


Ennals, David
McCuire, Michael
Thornton, Ernest


Ensor, David
McKay, Mrs. Margaret
Tinn, James


Evans, Albert (Islington, S.W.)
Mackenzie, Gregor (Rutherglen)
Tomney, Frank


Evans, loan L. (Birm'h'm, Yardley)
Maclennan, Robert
Tuck, Raphael


Faulds, Andrew
McMillan, Tom (Glasgow, C.)
Urwin, T. W.


Fletcher, llaymond (Ilkeston)
McNamara, J. Kevin
Varley, Eric G.


Fletcher, Ted (Darlington)
MacPherson, Malcolm
Wainwright, Edwin (Dearne Valley)


Foot, Rt. Hn. Sir Dingle (Ipswich)
Mahon, Peter (Preston, S.)
Walker, Harold (Doncaster)


Foot, Michael (Ebbw Vale)
Mallalieu,J.P.W.(Huddersfield,E.)
Wallace, George


Forrester, John
Manuel, Archie
Watkins, David (Consett)


Fraser, John (Norwood)
Marks, Kenneth
Watkins, Tudor (Brecon &amp; Radnor)


Freeson, Heginald
Marquand, David
Weitzman, David


Galpern, Sir Myer
Mason, Rt. Hn. Roy
Wellbeloved, James


Gardner, Tony
Maxwell, Robert
Whitaker, Ben

The Committee divided: Ayes 244, Noes 181.

White, Mrs. Eirene
Williams, Mrs. Shirley (Hitchin)



Wilkins, W. A.
Willis, Rt. Hn. George
TELLERS FOR THE AYES:


Williams, Alan (Swansea, W.)
Winnick, David
Mr. Neil McBride and


Williams, Alan Lee (Hornchurch)
Woodburn, Rt. Hn. A.
Mr Alan Fitch.


Williams, Clifford (Abertillery)
Woof, Robert





NOES


Alison, Michael (Barketon Ash)
Glyn, Sir Richard
Osborn, John (Hallam)


Astor, John
Godber, Rt. Hn. J. B.
Page, Graham (Crosby)


Atkins, Humphrey (M't'n &amp; M'd'n)
Goodhart, Philip
Page, John (Harrow, W.)


Awdry, Daniel
Goodhew, Victor
Pearson, Sir Frank (Clitheroe)


Baker, Kenneth (Acton)
Grant, Anthony
Peel, John


Baker, W. H. K. (Banff)
Grant-Ferris, R.
Peyton, John


Bell, Ronald
Griffiths, Eldon (Bury St. Edmunds)
Pink, R. Bonner


Bennett, Sir Frederic (Torquay)
Hall, John (Wycombe)
Pounder, Rafton


Bennett, Dr. Reginald (Got. &amp; Fhm)
Hall-Davis, A. G. F.
Powell, Rt. Hn. J. Enoch


Berry, Hn. Anthony
Hamilton, Lord (Fermanagh)
Price, David (Eastleigh)


Biffen, John
Hamilton, Michael (Salisbury)
Prior, J. M. L.


Biggs-Davison, John
Harvie Anderson, Miss
Pym, Francis


Birch, Rt. Hn. Nigel
Hastings, Stephen
Quennell, Miss J. M.


Black, Sir Cyril
Hawkins, Paul
Rawlinson, Rt. Hn. Sir Peter


Blaker, Peter
Heald, Rt. Hn. Sir Lionel
Rees-Davies, W. R.


Boardman, Tom (Leicester, S.W.)
Heath, Rt. Hn. Edward
Renton, Rt. Hn. Sir David


Body, Richard
Higgins, Terence L.
Ridley, Hn. Nicholas


Bossom, Sir Clive
Hiley, Joseph
Ridsdale, Julian


Boyle, Rt. Hn. Sir Edward
Hill, J. E. B.
Rodgers, Sir John (Sevenoaks)


Braine, Bernard
Hirst, Geoffrey
Rossi, Hugh (Hornsey)


Brinton, Sir Tatton
Hogg, Rt. Hn. Quintin
Royle, Anthony


Brown, Sir Edward (Bath)
Holland, Philip
Russell, Sir Ronald


Bruce-Gardyne, J.
Hordern, Peter
St. John-Stevas, Norman


Bryan, Paul
Hornby, Richard
Scott, Nicholas


Buck, Antony (Colchester)
Howoll, David (Guildford)
Scott-Hopkins, James


Bullus, Sir Eric
Hunt, John
Sharples, Richard


Campbell, B. (Oldham, W.)
Hutchison, Michael Clark
Shaw, Michael (Sc'b'gh &amp; Whitby)


Campbell, Gordon (Moray &amp; Nairn)
Iremonger, T. L.
Silvester, Frederick


Carr, Rt. Hn. Robert
Jenkin, Patrick (Woodford)
Sinclair, Sir George


Chichester-Clark, R.
Jopling, Michael
Smith, Dudley (W'wick &amp; L'mington)


Clark, Henry
Kaberry, Sir Donald
Smith, John (London &amp; W'minster)


Clegg, Walter
Kershaw, Anthony
Speed, Keith


Cooke, Robert
Kimball, Marcus
Stainton, Keith


Cooper-Key, Sir Neill
King, Evelyn (Dorset, S.)
Steel, David (Roxburgh)


Cordle, John
Knight, Mrs. Jill
Stoddart-Scott, Col. Sir M. (Ripon)


Corfield, F. V.
Lancaster, Col. C. G.
Summers, Sir Spencer


Coatain, A. P.
Lane, David
Tapsell, Peter


Craddock, Sir Beresford (Spelthorne)
Langford-Holt, Sir John
Taylor, Frank (Moss Side)


Cunningham, Sir Knox
Lewi s, Kenneth (Rutland)
Temple, John M.


d'Avigdor-Goldsmid, Sir Henry
Lloyd, Ian (P'tsm'th, Langstone)
Thatcher, Mrs. Margaret


Dean, Paul (Somerset, N.)
Lloyd, Rt. Hn. Selwyn (Wirral)
Tilney, John


Deedes, Rt. Hn. W. F. (Ashford)
Loveys, W. H.
Turton, Rt. Hn. R. H.


Digby, Simon Wingfield
Lubbock, Eric
Wainwright, Richard (Colne Valley)


Dodds-Parker, Douglas
MacArthur, Ian
Walker-Smith, Rt. Hn. Sir Derek


Doughty, Charles
Maclean, Sir Fitzroy
Walters, Dennis


Douglas-Home, Rt. Hn. Sir Alec
Macleod, Rt. Hn. lain
Ward, Dame Irene


Drayson, G. B.
McMaster, Stanley
Webster, David


Eden, Sir John
Maddan, Martin
Whitelaw, Rt. Hn. William


Elliot, Capt. Walter (Carshalton)
Maginnis, John E.
Williams, Donald (Dudley)


Elliott,R.W.(N'c'tle-upon-Tyne,N.)
Marten, Neil
Wills, Sir Gerald (Bridgwater)


Emery, Peter
Maude, Angus
Wilson, Geoffrey (Truro)


Errington, Sir Eric
Mawby, Ray
Winstanley, Dr. M. P.


Farr, John
Maxwell-Hyslop, R. J.
Wolrige-Gordon, Patrick


Fletcher-Cooke, Charles
Maydon, Lt.-Cmdr. S. L. C.
Woodnutt, Mark


Fortescue, Tim
Mills, Peter (Torrington)
Worsley, Marcus


Foster, Sir John
Mills, Stratton (Belfast, N.)
Wylie, N. R.


Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
More, Jasper
Younger, Hn. George


Galbraith, Hn. T. G.
Morrison, Charles (Devizes)



Gibson-Watt, David
Munro-Lucas-Tooth, Sir Hugh
TELLERS FOR THE NOES:


Gilmour, Ian (Norfolk, C.)
Murton, Oscar
Mr Reginald Eyre and


Gilmour, Sir John (Fife, E.)
Nabarro, Sir Gerald
Mr Hector Monro.


Glover, Sir Douglas
Nott, John

Clause 5

PURCHASE TAX

Mr. Terence L. Higgins: I beg to move Amendment No. 207, in page 5, line 11, leave out 'from' and insert 'of'.

The Chairman: With this Amendment it would be convenient to discuss Amend-


ment No. 208, in page 5, line 13, at end insert:
'and articles of any of the descriptions known as greeting cards'.
and Amendment No. 214, in page 5, line 13, at end insert:
(c) as from 30th April 1968 with the amendment of Group 26 by the addition to paragraph (a) of the words 'other than charity greetings cards' and the insertion after


'articles' of the words 'including charity greeting cards'.

Mr. Higgins: These Amendments arise directly from the debate which we had in the Standing Committee, in the sense that they seek to amend an Amendment which was made in that Committee. It is perhaps significant that, in the general air of confusion which surrounds many procedures of this Recommittal stage, we should be debating this subject.
Effectively what the Government did in the Finance Bill this year was to alter the basic structure of Purchase Tax. In place of the three rates which previously prevailed, they introduced a fourth rate, a 50 per cent. luxury rate. So the overall trend of Purchase Tax over the years towards narrower and narrower differentials and fewer and fewer rates was reversed. They have now adopted a policy which we do not believe is the right approach concerning Purchase Tax.
During the course of this exercise the Government have included in the 50 per cent. rate a number of items in Clause 5(b), including
Diaries, calendars and similar articles.
That is to say, they decided that, instead of having a 50 per cent. rate on diaries, calendars and similar articles, they should have only a 33⅓ per cent. rate. The mechanics by which this exercise was achieved was to lop off from the tail end of what had previously been in this category items which included greetings cards. It became apparent, from the feeling in Committee, that many hon. Members believed it was wrong of the Government to reduce the rate on diaries, calendars and similar articles, which we supported, without also reducing the 50 per cent. rate on greetings cards. I shall refer to some of the reasons why we thought that was so and add some additional reasons.
Amendment No. 214, which we are also discussing, is concerned with charity greetings cards. I should like to treat this as a probing Amendment, because it raises a number of difficult problems concerning the relationship between commercial greetings cards and charity greetings cards.
The essential point which we made in Committee—and we believe it to be a strong one—is that the Government, in their use of the Purchase Tax mechanism,


are now moving more and more towards an arbitrary system where the pattern of consumption is being distorted. By use of the Purchase Tax mechanism, the Government are seeking to impose a certain pattern of consumption by saying that some things should be taxed more heavily than others. To the extent that this relies on some appraisal of whether the effect of the tax is likely to affect total sales and, therefore, total revenue, I think there is a reasonable economic case for arguing on these lines.
In economists' jargon, one would be trying to vary the tax according to the elasticity of demand. But it is a different matter when one tends to say that this or that item is good or bad in itself. We think that there is an economic case, but we do not believe that there is the value-judgment case for discriminating in this way.
We have had great difficulty in deciding whether there is any rationale between the four categories in place of the three which the Government have decided upon. On a subsequent Amendment we shall discuss some of the other items included in the various rates, but in this Amendment we are concerned with greetings cards.
One would not have thought that greetings cards, the average price of which is about 1s. 3d., and not more than 1s. 6d., would be regarded as luxury items and put into the same category as gold, jewellery, furs or luxury motor cars. The sending of greetings cards, while it may be very widespread, is not something one would think that the very rich had a great propensity to indulge in rather than the very poor. We suggest that the reverse may be the case. If that is so, surely the whole idea of Purchase Tax grading itself in this way, from the point of view of saying that this or that thing is good or bad, is false in this instance. Even on the economic basis, the argument that this is something which can stand a big increase in taxation is open to grave doubt.
Therefore, we believe that it is right and proper that the Government should look at this Amendment with sympathy and, at any rate, should reduce the rate to the same level as that which they are now charging, as a result of the Amendment accepted in Committee, on diaries, calendars and similar articles. We feel



that if the 33⅓ per cent. rate is right in this instance for diaries, calendars and similar articles, it should be the right rate for greetings cards. For that reason we commend this Amendment to the Government.
6.15 p.m.
Turning to Amendment No. 214, nearly all charity greetings cards are sent at Christmas time, whereas greetings cards otherwise may cover a number of other events such as birthdays, anniversaries and so on. Very few charities send out cards of a general nature designed to raise revenue for their charitable purposes. There are one or two exceptions. The Mouth and Foot Painting Artists, Ltd., which employs people who paint cards using their mouths or their feet, because they are armless, sells charitable cards which can be used for a number of purposes, such as birthdays, and so on; but, by and large, the charity market is restricted to Christmas cards.
Two important points arise. The Committee will recall that we debated this matter on 21st June last year on a new Clause to the Finance Bill proposed by my hon. Friend the Member for Horn-sey (Mr. Rossi). Alas, as a result of the pace at which Government legislation is being put through, my hon. Friend is engaged upstairs on the Prices and Incomes Bill, but he has asked me to say that he is sorry not to have an opportunity of again supporting the view that he put forward in the Finance Bill Committee last year.
My hon. Friend put forward a powerful case. His new Clause suggested that there was a strong case for the Government refunding Purchase Tax on charity greetings cards. My hon. Friend accepted—and I would probably accept as well—that difficulties may arise if charity greetings cards are excluded and other greetings cards are not, because may be that they will be more competitive in price and commercial interests will suffer. However, if some form of refund were made this would not be likely to be the case. This is debatable. Therefore, I think that we should treat this as a probing Amendment. If the Government accept the principle of the Amendment but suggest some other mechanism for doing it, I am sure my hon. Friends would not object.
A heavy tax is being imposed on charity greetings cards, which are not the most expensive type of cards. I gather that the average price of a Christmas card is about 7d., whereas the average price of an ordinary greetings card is about 1s. 3d. Consequently, in an earlier debate, the figures produced by the Government about the cost of making this variation in the tax rate were considerably exaggerated. The total revenue derived from Christmas cards is, therefore, correspondingly less than one might expect at first sight. Perhaps the Financial Secretary, if he is to reply, will be able to give some indication of the revenue raised from Christmas cards compared with other cards and how much the cost of these two sets of Amendments might be.
The point is that the Government are imposing a tax on a form of activity which is designed to raise money for charity. We believe that that is a bad principle and that we should look at it very carefully. After all, the Government have recognised that, generally speaking, taxing charities ought not to be done.
For example, I understand that the revenue which charities receive from investments is exempt from Income Tax. Charities are able to claim back the Income Tax which they pay on revenue received from covenants. In the classic case of Selective Employment Tax, the Government initially imposed a tax on charities but we were able to get them to change their minds and remove it. There would be some consistency of approach if they, perhaps not eliminated but did not increase the Purchase Tax on these items to the penal rate of 50 per cent.
Charity cards have had a great increase imposed on them, and for a reason which may not be immediately apparent, because all charity cards are normally purchased at cost. I understand that the Inland Revenue adds to that cost the amount of mark-up which would normally be imposed if goods were sold on a wholesale basis. Until a few years ago—I think until the end of 1966— this mark-up was calculated at 50 per cent., which the Prices and Incomes Board might feel is high, but then the Inland Revenue increased the 50 per cent. mark up to 75 per cent.
On top of that notional wholesale figure there is imposed whatever the Purchase Tax may be. First we had the initial rate. It was then increased by the amount of the regulator. This was then consolidated, and now the Purchase Tax has been raised to 50 per cent. Effectively, there has been a whole series of increases in the tax burden imposed on charity Christmas cards, and perhaps the Financial Secretary will tell us what the percentage increase is now, as against the tax which was imposed on them in say 1964. It seems possible that the increased burden which has been imposed on them may be greater than the tax increase on almost any other category, certainly in the Purchase Tax range, and possibly across the whole range of taxation.
The amount involved is considerable. In the debate last year the figure was quoted of £8,500 being paid by the British Empire Cancer Campaign, but this sum will now be greatly increased as a result of increasing Purchase Tax from 27½ per cent. to 50 per cent. The overall burden on all these charities will be greatly increased. I shall not weary the Committee by going through them charity by charity, but the revenue which they receive from this source is very important. We therefore feel that this issue should be examined with the greatest care.
We must also bear in mind the overall position of commercial cards. We think that the best way to meet both cases is to make the Amendment to reduce the rate of Purchase Tax on the basis which we have suggested. We can find no basis for agreeing to an increase in the tax to the rate of 50 per cent. proposed by the Government. In the absence of any concession, but we are hopeful that there will be one, I hope that my hon. Friends will vote for the Amendments.

Sir D. Glover: I propose to refer particularly to Amendments Nos. 208 and 214. With regard to charity greeting cards, I was a little surprised when my hon. Friend the Member for Worthing (Mr. Higgins), in his able speech, talked about referring the profit to the Prices and Incomes Board because of a mark-up of 50 per cent. while the Inland Revenue uplifts it to 75 per cent., because a high mark-up is necessary if charities are to


come out with any profit at all. I do not suppose that, in practice, a mark-up of 75 per cent. works out as excessive, but we are not debating whether the matter should be submitted to the Prices and Incomes Board.
I ask the Financial Secretary to look again at the question of charity greeting cards. As my hon. Friend said, nearly all these cards are issued at Christmas time, and it is, therefore, fairly easy for the Inland Revenue to control their sale. The problem of dealing with the matter if there is to be any Purchase Tax at all is very complicated, and I suggest that it is wrong for the State to extract its pound of flesh from a charity. Charity greeting cards ought to be free of the tax, as they were until comparatively recently. I think that that is the only answer to the problem, because whatever rate of tax is imposed on these cards, as my hon. Friend said, the difficulty is that one cannot have a separate system for charity greeting cards. They have to be lumped in with all the Christmas cards that are sold.
A charity not only has to pay the tax, but must have a mark up for the notional profit, and the wholesale profit, on to which tax is added. If it is not 50 per cent., but only 33⅓ per cent., it is still an enormous amount and alters the price of the card. If a card costs 9d., and there is a mark-up of, say, 4½d.— that is 50 per cent.—and then Purchase Tax of 33⅓ per cent. is added, taking into account the profit which has to be included to bring in a worthwhile return, that card will have to retail for about 2s. If a charity greetings card sells for 6d.—and that is about the price at which most charities try to get them out—if tax has to be paid, it is necessary to get out a card which costs about 2d.
This means that it is an inferior card, and the public will not buy it to send to their friends. Anyone who receives a charity greetings card accepts that it is not as nice a card as one that is sent for purely commercial purposes, and in respect of which the sender gets value for money. If someone receives a card which says that all the benefits from the card are going to a charity, he accepts that it is not as good as an ordinary commercial card, but he expects, and the person who sends the card expects, that



it will look something like a Christmas card.
There will be great difficulty in getting out a Christmas card which carries this rate of Purchase Tax plus the Inland Revenue uplift for calculating the tax. It will be difficult to get out a worthwhile card to retail for about 6d. Therefore, apart from the added burden for the charitable organisations, they will find that over the years their turnover will drop steadily because they will not be able to provide as good a card as they were able to before Purchase Tax was brought in.
Therefore, while I would like to see the tax on charity greeting cards done away with altogether, I would certainly support any amendment to reduce the amount of Purchase Tax that the Government of the day are proposing to impose at any given time. I have great pleasure, therefore, in supporting Amendment No. 214.
6.30 p.m.
I come now to Amendment No. 208. I made a speech about greeting cards in the Committee upstairs. I was able at that time to use my own recent experience of hospital to tell the Committee at great length of the many greeting cards I had had from hon. Members on both sides of the Committee, saying "Get well quick". I told the Financial Secretary then what the result of this tax would be. Having told him what would happen I was suddenly taken back to hospital and, during my second incarceration, because of the evils of the Government, all I received were letters. People simply cannot afford any longer to send these cards.
Many of the hon. Gentleman's hon. Friends and more on this side of the Committee were kind enough to write to me saying they hoped that I would soon be well, but would not be back in the House in time for the Committee stage of the Finance Bill; but they have been able to write only letters. One hon. Gentleman, who, presumably, was using old stock, sent me a card bearing the picture of a shoe saying "Get well quick. There is no one to put in your shoes in the House"—which, of course, was very nice.
But people will not get cards of this kind any more, because the price will


be too high, going up from 1s. 3d. to about 2s. One of my branch chairmen sent me a very nice greeting card with the post-script, "Don't do this again. The cost is too excessive. We cannot afford it". That will show the Financial Secretary what is happening as a result of the evil, Scrooge-like attitude shown by the Government towards these greeting cards.
The tax on calendars, for example, has been reduced, but in my view the tax on greeting cards is far more important. Cannot the hon. Gentleman accept this Amendment and bring the greeting card into the lower tax category? He cannot really be such a Scrooge, nor surely can his right hon. Friend the Chancellor of the Exchequer, as to think that his or my hon. Friends who send a "Get well quick" greeting card are in the Rolls-Royce class, that they are sending a gift beyond the wealth of diamonds.
This is something which the poor, the needy, the old and the lonely throughout the country use today to send people a message reminding them of anniversaries; and they do not expect to have to spend a fortune on such cards. Yet under this Bill they are to be bunged up with a 50 per cent. Purchase Tax on something which is bought by people wishing to send cheer to someone who very much needs it or to mark a birthday, anniversary or some other occasion when people want to be cheered up.
The Government are so lacking in the psychology—no wonder people vote against them—of what makes people tick that they feel that kind of greeting card ought to bear 50 per cent. Purchase Tax. If the Government seriously believe that that is where greeting cards ought to be in the broad spectrum of Purchase Tax, right in the top category, then I believe that a great many of the hon. Gentlemen opposite ought to have their heads seen to. Under this Amendment we are accepting that the Government, under pressure as a result of their mismanagement of our affairs, have this year had to raise a lot of money in the Budget. We are not saying, in this particular Amendment, that greeting cards should this year be exempted from all tax, but it seems completely wrong to put them in the top category, in the exclusive, expensive field of Purchase Tax. It is not as though to



accept the Amendment would be to wreck the whole Budget. If the Government were to accept it it would show that they understood what could be called the human approach.
After all, the amount of Purchase Tax involved, even if this Amendment is accepted, would be a very excessive tax to put on the good wishes and generous spirit which causes people to buy greeting cards to send to their friends, relatives and acquaintances in sickness, to which I have drawn attention, or to show that they have remembered an anniversary, a birthday or a wedding. For the Government to be so out of touch with human thinking as to feel that that kind of gesture can carry a greater rate of Purchase Tax shows in a very simple way why they are so unpopular with the public at large.
I hope, therefore, that the hon. Gentleman the Financial Secretary will be able to accept this Amendment which would cost very little money, but would bring an enormous feeling of well-being to a great many people—not wealthy people —throughout the country who use these cards to bring some light and cheer to friends who are ill or to those who are celebrating a happy anniversary.

Miss Joan Quennell: I was tempted not to intervene, first, because as a member of the Committee, I was able to make a contribution at that stage and, secondly, because it hardly seemed necessary for any other member of the Committee to do so after the lucid and succinct exposition of the Amendment by my hon. Friend the Member for Worthing (Mr. Higgins).
It seems to me that these two Amendments deal with two quite separate issues. The first is the greeting card which is now sent widely throughout the country on all kinds of occasions. The second is the charity card. Both groups will now attract the highest rate of Purchase Tax. In Standing Committee, the Minister of State, speaking on an Amendment to this part of the Clause, made a curious definition. He described goods attracting Purchase Tax as being either luxury, less essential, or necessary. I believe that one would find it very hard to see how the chanty type of card could be described as a luxury.
As my hon. Friend the Member for Ormskirk (Sir D. Glover) has said, this


type of card, of the cheaper variety, is produced by all kinds of charities and organisations throughout the country in order to raise funds and to promote and advertise themselves and their cause. It is hard to see by any stretch of the imagination how such cards could be described as a luxury item. I suppose that it could be said that they are not entirely necessary, but I really begin to wonder, because so many of these organisations are seeking to raise funds for necessary purposes. However, that is not a point which comes into the Purchase Tax structure of the country.
There is another anomaly in those Amendments dealing with greetings cards. The cards commonly sent, although they will attract the luxury rate, are not generally used by the rich and those with a luxurious way of life. It is generally the old-age pensioner, the sick, the elderly and the less affluent who will suffer the swingeing impost of 50 per cent. and I would like to hear the thinking behind this curious decision, and whether the Treasury could not reconsider it.

Mr. Harold Lever: The points raised have been considered before and I have tried to look at them with a fresh mind, my hon. and learned Friend the Minister of State said in Standing Committee that, in deciding the rate of duty, greetings cards were not one of the more essential items, and that is not unfair. What rate they should bear is a matter of personal judgment. I do not suggest that they are a great luxury of the idle rich, but they are the kind of article which can reasonably bear a fairly heavy rate, particularly since the amount involved in each purchase is so trifling.
The hon. Member for Ormskirk (Sir D. Glover) missed my welcome back in our earlier debate. He will not mind my saying that, if the tax deters him from "doing it again", that will be an additional reason in favour of it. Certainly, no one would question that the greetings card is a satisfying and emotional thing for the giver and the receiver, but if one takes the figures of the hon. Member for Worthing (Mr. Higgins), of 1s. 3d. and 1s. 9d., as typical for such cards, the difference between the proposed 50 per cent., and the present 33⅓ per cent. is a matter of ½d. or 1d. for each card, and is not a matter of great party political contest.
The hon. Member for Worcestershire, South (Sir G. Nabarro), who did not intervene—and I am not asking him to —has said that the Tory Party is the motorists' friend. The hon. Member for Worthing would probably claim that he is the friend of the greetings card sender, and will probably make similar claims during our three days' debate. Unhappily, this Budget requires to raise a great deal of revenue. The cost of this concession would be £3¾ million, and, therefore, I can take no different view from that of my hon. and learned Friend—

Sir G. Nabarro: This matter falls under Group 26 of the list which the Chancellor moved after the Budget, comprising diaries, calendars and greetings cards. Is the £3¾ million the cost of the concession if only charity cards were exempted or does it relate to all cards?

Mr. Lever: This refers to the total cost of the Amendments. I could have worked out the cost of the charity concession, since charities are reported to account for under a quarter of the total turnover, so, presumably, the relief would cost the same proportion. But the fatal argument about granting such a concession is that it would allow charities to enter ordinary trade—that is all that this is—on preferential terms. Hon. Members will not support that, I think. One cannot tell greetings card traders, carrying on lawful business, that competition will be loosed upon them by people with a tax advantage as distinct from the profitable overall result which they have on their Income Tax, profits and dividend receipts. That is not the same as sending them into the market place with articles which other traders manufacture, but at preferential terms of Purchase Tax. It could not even be restricted to cards. Charities sell other dutiable articles, and we should, rightly, be pressed for other concessions.
Although I sympathise with the idea of greeting people, I hope that the hon. Member for Worthing, if he thinks that we are distorting the consumer pattern by charging 50 per cent., which I doubt, does not think that it is because the


Government have a policy of reducing the number of greetings which people send. A false inference is often drawn that we increase taxes on the activities which we most dislike. This is wholly contrary to the purpose of the tax, which is to raise revenue; if we were trying to reduce or eliminate the activity we would hardly look to it as a source of revenue.
This is a matter of judgment, and mine is that taxation of these modestly-priced articles is one way of raising extra revenue, granted the assumptions of the Budget.

Mr. Higgins: Our point was that, although the sum involved may not seem much to hon. Members, it is often large to an old age pensioner or someone who likes to send or receive cards. I find it difficult to understand when we are told that the effect of a tax increase will not be much on the cost of living, but that the amount of revenue raised is much too big to be cut out of the Budget. I know that if the Government accepted the third Amendment that might not be the best way of giving relief to charity Cards, and that, if relief were given on the lines of last year's, which would not lead to an increase in price, since the charities would not pay tax but would have greater revenue for charitable purposes, this would be acceptable to us.
The overwhelming point is that the Government have set up four classes of which, I suppose, the top class is the luxury class, the next down is not the more essential items, the next consists of the almost essential items and the lowest is the essential items, although even that is taxed by this Government.
The Financial Secretary conceded that greeting cards are not a luxury and the Minister of State said that they are not one of the more essential items. It seems clear, therefore, that they should bear not the top rate of tax, 50 per cent., but the second rate, 33⅓ per cent., which is what this series of Amendments is designed to secure. Because of the disappointing reply of the Financial Secretary, I hope that my hon. Friends will divide the Committee.

Question put, That the Amendment be made:—

Division No. 218.]
AYES
[6.50 p.m.


Alison, Michael (Barkston Ash)
Godber, Rt. Hn. J. B.
Nott, John


Astor, John
Goodhart, Philip
Oeborn, John (Hallam)


Atkins, Humphrey (M't'n &amp; M'd'n)
Goodhew, Victor
Page, Graham (Crosby)


Awdry, Daniel
Cower, Raymond
Pearson, Sir Frank (Clitheroe)


Baker, Kenneth (Acton)
Grant, Anthony
Peel, John


Baker, W. H. K. (Banff)
Grant-Ferris, R.
Peyton, John


Bell, Ronald
Griffiths, Eldon (Bury St. Edmunds)
Pink, R. Bonner


Bennett, Dr. Reginald (Gos. &amp; Fhm)
Hall-Davis, A. G. F.
Pounder, Rafton


Berry, Hn. Anthony
Hamilton, Lord (Fermanagh)
Powell, Rt. Hn. J. Enoch


Biff en, John
Hamilton, Michael (Salisbury)
Price, David (Eastleigh)


Bjggs-Davison, John
Harvie Anderson, Miss
Prior, J. M. L.


Birch, Rt. Hn. Nigel
Hastings, Stephen
Pym. Francis


Black, Sir Cyril
Hawkins, Paul
Quennell, Miss J. M.


Blaker, Peter
Heald, Rt. Hn. Sir Lionel
Rawlinson, Rt. Hn. Sir Peter


Boardman Tom (Leicester, S.W.)
Heath, Rt. Hn. Edward
Rees-Davies, W. R.


Body, Richard
Higgins, Terence L.
Renton, Rt. Hn. Sir David


Bossom, Sir Clive
Hiley, Joseph
Ridley, Hn. Nicholas


Braine, Bernard
Hill, J. E. B.
Ridsdale, Julian


Brinton, Sir Tatton
Hirst, Geoffrey
Rodgers, Sir John (Sevenoaks)


Brown, Sir Edward (Bath)
Hogg, Rt. Hn. Quintin
Rossi, Hugh (Hornsey)


Bruce-Gardyne, J.
Holland, Philip
Russell, Sir Ronald


Bryan, Paul
Hordem, Peter
St. John-Stevas, Norman


Buck, Antony (Colchester)
Hornby, Richard
Scott, Nicholas


Bullus, Sir Eric
Howell, David (Guildford)
Sharpies, Richard


Campbell, B. (Oldham, W.)
Hunt, John
Shaw, Michael (Sc'b'gh &amp; Whitby)


Campbell, Cordon (Moray &amp; Nairn)
Hutch son, Michael Clark
Silvester, Frederick


Carr, Rt. Hn. Robert
Iremonger, T. L.
Sinclair, Sir George


Chichester Clark, R.
Jenkin, Patrick (Woodford)
Smith, Dudley (W'wick &amp; L'mington)


Clark, Henry
Jopling, Michael
Smith, John (London &amp; W'minster)


Clegg, Walter
Kimball, Marcus
Speed, Keith


Cooke, Robert
King, Evelyn (Dorset, S.)
Stainton, Keith


Cooper-Key, Sir Neill
Knight, Mrs. Jill
Steel, David (Roxburgh)


Cordle, John
Lancaster, col. C. G.
Stoddart-Scott, Col. Sir M. (Ripon)


Corfield, F. V.
Lane, David
Summers, Sir Spencer


Costain, A. P.
Langford-Holt, Sir John
Tapsell, Peter


Craddock, Sir Beresford (Spelthorne)
Lew s, Kenneth (Rutland)
Temple, John M.


Cunningham, Sir Knox
Lloyd, Ian (P'tsm'th, Langstone)
Thatcher, Mrs. Margaret


d'Avigdor-cSoldsmid, Sir Henry
Lloyd, Rt. Hn. Selwyn (Wirral)
Thorpe, Rt. Hn. Jeremy


Dean, Paul (Somerset, N.)
Loveys, W. H.
Tilney, John


Deedes, Rt. Hn. W. F. (Ashford)
Lubbock, Eric
Turton, Rt. Hn. R. H.


Digby, Simon Wingfield
MacArthur, Ian
Van straubenzee, W. R.


Doughty, Charles
Mackenzie,Alasdair(Ross&amp;Crom'ty)
Wainwright, Richard CColne Valley)


Drayson, G. B.
Maclean, Sir Fitzroy
Walters, Dennis


Eden, Sir John
Maoleod, Rt. Hn. lain
Ward, Dame Irene


Elliot, Capt. Walter (Carshalton)
McMaster, Stanley
Webster, David


Elliott.R.w.(N'c'tle-upon-Tyne.N.)
Maddan, Martin
Whitelaw, Rt. Hn. William


Errington, Sir Eric
Marten, Neil
Williams, Donald (Dudley)


Eyre, Reginald
Maude, Angus
Wills, Sir Gerald (Bridgwater)


Farr, John
Mawby, Ray
Wilson, Geoffrey (Truro)


Fletcher-Cooke, Charles
Maxwell-Hyslop, R. J.
Winstanley, Dr. M. P.


Fortescue, Tim
Maydon, Lt.-Cmdr, S. L. C.
Wolrige-Gordon, Patrick


Foster, Sir John
Mills, Peter (Torrington)
Woodnutt, Mark


Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
Mills, Stratton (Belfast, N.)
Worsley, Marcus


Galbraith, Hn. T. G.
Monro, Hector
Wylie, N. R.


Gibson-Watt, David
Morrison, Charles (Devizes)
Younger, Hn. George


Gilmour, Ian (Norfolk, C.)
Munro-Lucas-Tooth, Sir Hugh



Cilmour, Sir John (Fife, E.)
Murton, Oscar
TELLERS FOR THE AYES:


Glover, Sir Douglas
Nabarro, Sir Gerald
Mr. Jasper More and


Glyn, Sir Richard
Noble, Rt. Hn. Michael
Mr. Anthony Royle.




NOES


Albu, Austen
Boardman, H. (Leigh)
Cant, R. B.


Allaun, Frank (Salford, E.)
Booth, Albert
Carmichael, Neil


Alldritt, Walter
Bottomley, Rt. Hi. Arthur
Carter-Jones, Lewis


Atkins, Ronald (Preston, N.)
Boyden, James
Coe, Denis


Atkinson, Norman (Tottenham)
Braddock, Mrs. E. M.
Coleman, Donald


Bagier, Gordon A. T.
Bradley, Tom
Concannon, J. D.


Barnett, Joel
Brooks, Edwin
Conlan, Bernard


Baxter, William
Brown, Rt. Hn. George (Belper)
Crawshaw, Richard


Beaney, Alan
Brown, Hugh D. (C'gow, Provan)
Cronin, John


Benn, Rt. Hn. Anthony Wedgwood
Brown,Bob(N'c'tle-upon-Tyne,W.)
Crosland, Rt. Hn. Anthony


Bennett, James (G'gow, Bridgeton)
Brown, R. W. (Shoreditch &amp; F'bury)
Crossman, Rt. Hn. Richard


Bidwell, Sydney
Buchan, Norman
Cullen, Mrs. Alice


Bishop, E. S.
Buchanan, Richard (G'gow, Sp'burn)
Dalyell, Tarn


Blackburn, F.
Butler, Herbert (Hackney, C.)
Darling, Rt. Hn. George


Blenkinsop, Arthur
Callaghan, Rt. Hn. James
Davies, G. Elfed (Rhondda, E.)

The Committee divided: Ayes 173. Noes 234.

Davies, Dr. Ernest (Stretford)
Jones, J. Idwal (Wrexham)
Parker, John (Dagenham)


Davies, Ifor (Cower)
Kelley, Richard
Parkyn, Brian (Bedford)


Dempsey, James
Kenyon, Clifford
Pearson, Arthur (Pontyprldd)


Dewar, Donald
Kerr, Mrs. Anne (R'ter &amp; Chatham)
Pentland, Norman


Dickens, James
Kerr, Russell (Feitham)
Perry, Ernest G. (Battersea, S.)


Dobson, Ray
Lawson, George
Perry, George H. (Nottingham, S.)


Doig, Peter
Leadbitter, Ted
Price, Thomas (Westhoughton)


Dunn, James A.
Ledger, Ron
Probert, Arthur


Dunnett, Jack
Lee, Rt. Kn. Frederick (Newton)
Randall, Harry


Dunwoody, Mrs. Gwyneth (Exeter)
Lee, John (Reading)
Rankin, John


Dunwoody, Dr. John (F'th &amp; C'b'e)
Lestor, Miss Joan
Rees, Merlyn


Eadie, Alex
Lever, Harold (Cheetham)
Reynolds, Rt. Hn. G. W.


Edelman, Maurice
Lewis, Arthur (W. Ham, N.)
Richard, Ivor


Edwards, Robert (Bilston)
Lewis, Ron (Carlisle)
Roberts, Albert (Normanton)


Edwards, William (Merioneth)
Lipton, Marcus
Roberts, Gwilym (Bedfordshire, S.)


Ellis, John
Lomas, Kenneth
Robertson, John (Paisley)


Ennals, David
Loughtin, Charles
Robinson, Rt. Hn. Kenneth (St.P'c'as)


Ensor, David
Luard, Evan
Robinson, W. O. J. (Walth'stow, E.)


Evans, Albert (Islington, S.W.)
Lyon, Alexander W. (York)
Rodgers, William (Stockton)


Faulds, Andrew
Lyons, Edward (Bradford, E.)
Rogers, George (Kensington, N.)


Fitch, Alan (Wigan)
McBride, Neil
Ross, Rt. Hn. William


Fletcher, Raymond (Ilkeston)
McCann, John
Shaw, Arnold (Illford, S.)


Fletcher, Ted (Darlington)
MacColl, James
Sheldon, Robert


Foot, Michael (Ehbw Vale)
Macdonald, A. H.
Shinweli, Rt. Hn. E.


Forrester, John
McGuire, Michael
shore, Rt. Hn. Peter (Stepney)


Fraser, John (Norwood)
McKay, Mrs. Margaret
Silkin, Rt. Hn. John (Depfford)


Freeson, Reginald
Mackenzie, Gregor (Rutherglen)
Silverman, Julius


Galpern, Sir Myer
Maclennan, Robert
Slater, Joseph


Gardner, Tony
McMillan, Tom (Glasgow, C.)
Small, William


Garrett, W. E.
McNamara, J. Kevin
Snow, Julian


Gordon Walker, Rt. Hn. P. C.
MacPherson, Malcolm
Spriggs, Leslie


Gray, Dr. Hugh (Yarmouth)
Mahon, Peter (Preston, S.)
Swain, Thomas


Greenwood, Rt. Hn. Anthony
Mallalieu, J. P. W. (Hudderfield, E.)
Swingler, Stephen


Gregory, Arnold
Manuel, Archie
Symonds, J. B.


Grey, Charles (Durham)
Marquand,David
Taverne, Dick


Griffiths, David (Rother Valley)
Mason, Rt. Hn. Roy
Thomas, Rt. Hn. George


Griffiths, E. (Brightside)
Maxwell, Robert
Thornton, Ernest


Crifliths, Rt. Hn. James (Llanelly)
Mayhew, Christopher
Tinn, James


Griffiths, Will (Exchange)
Mikardo,Ian
Tomney, Frank


Hamilton, James (bothwell)
Milan, Bruce
Tuck, Raphael


Hamiling, William
Milne, Edward (Blyth)
Urwin, T.W.


Hannan, William
Mitchell, R. C. (S'th'pton, Test)
Varley, Eric G.



Moornman, Eric



Harper, Joseph
Morgan Elystan (Cardiganshire)
Wainwright, Edwin (Dearne Valley)


Harrison, Walter (Wakefield)
Morris, Alfred (Wythenshawe)
Walker, Horald (Doncaster)


Haseldine, Norman
Morris, Charles R.(Openshaw)
Wallace, George


Hazell, Bert
Morris lohn (Abaravon)
Watkins, David (Consett)


Heffer, Eric S.
Moyle, Roland
Watkins, Tudor (Brecon &amp; Radnor)


Henig, Stanley
Mulley, Rt. Hn. Frederick
Weitzman, David


Hilton, w. S.
Murray Albert
Wellbeloved, James


Houghton, Rt. Hn. Douglas
Neal, Harold
Wells, William (Walsall, N.)


Howarth, Harry (Wellingborough)
Newens, Stan
Whitaker, Ben


Howarth, Robert (Bolton, E.)
Noel-Baker, Rt. Hn. Philip (Derby,S.)
White, Mrs. Eirene


Hoy, James
Norwood, Christopher
Wilkins, W. A.


Huckfield, Leslie
Oakes, Gordon
Williams, Alan (Swansea, W.)


Hughes, Emrys (Ayrshire, S.)
Ogden, Eric
Williams, Alan Lee (Hornchurch)


Hughes, Roy (Newport)
O'Malley, Brian
Williams, Clifford (Abertillery)


Hunter, Adam
Orme, Stanley
Williams, Mrs. Shirley (Hitchin)


Hynd, John
Oswald, Thomas
Willis, Rt. Hn. George


Irvine, Sir Arthur (Edge Hill)
Owen, Dr. David (Plymouth, S'tn)
Winnick, David


Jackson, Colin (B'h'se &amp; Spenb'gh)
Owen, Will (Morpeth)
Woodburn, Rt. Hn. A.


Jackson, Peter M. (High Peak)
Page, Derek (King's Lynn)



Jeger, Mrs. Lena (H'b'n &amp; St.P'cras,S.)
Palmer, Arthur
TELLERS FOR THE NOES:


Jenkins, Rt. Hn. Roy (Stechford)
Pannell, Rt. Hn. Charles
Mr Ernest Armstrong and


Johnson, carol (Lewisham, S.)
Park, Trevor
Mr. loan L. Evans.

7.0 p.m.

Mr. Gardner: I beg to move Amendment No. 2, in page 5, line 13, at end add:
(2) Where an instrument included under Group 19 or 19A has been purchased by a registered blind person or person handicapped in such a way as to be unable to make use of books he shall be entitled to a refund of purchase tax paid on presentation of a receipted bill to the Commissioners.

The Deputy Chairman (Mr. Sydney Irving): With this Amendment we can


also discuss Amendment No. 36, in Schedule 6, page 56, line 31, after 'blind', insert:
'and those handicapped in such other manner as to be unable to make use of books'.

Mr. Gardner: Amendment No. 2 and the further Amendment are probing Amendments. I am very pleased to see that the Financial Secretary is to reply, because we know him as a kindly and generous man even if he is a representative of Her Majesty's Treasury. While



the wording of these Amendments may not be perfect, and we recognise that we are dealing with the somewhat difficult problem of extensions and special concessions, we hope, while not wishing to stick to the wording of the Amendments, that they will give the Treasury an opportunity to think again about three basic points.
At the moment, the Purchase Tax Act gives some exemption to the talking book service which is provided by the Royal National Institute for the Blind. Schedule 6 to the Bill gives an exemption for record players and records which are specially adapted for use by the blind. We would like the Government to consider whether that exemption can be extended a little further to include tape recorders and tape recordings.
Secondly, we want to extend the exemptions policy to certain other categories, to almost totally handicapped people incapable of using books.
Finally, by the main Amendment we would like to provide opportunity for blind people and others severely handicapped to be able to obtain a refund of Purchase Tax which they pay on normal commercial tape recorders.
The growth of the industry which makes and services tape recorders is quite remarkable. It is a growing and very lucrative business. I suppose that my right hon. Friend, looking at this, decided that here was a ready source of revenue, and I quite agree with him. This is a market in which the young and affluent are very active, the people who, in the main, have the money to spend. It seems reasonable that while we are taxing record players we should, at the same time, tax tape recorders, but, when we do that, we also close a door on very many people. With the imposition of the new rate of 33⅓ per cent. on the machines and 50 per cent. on the recordings themselves we are likely to hurt perhaps a limited number of people, but a number of people to whom this Committee has always shown sympathy. I hope, therefore, that my hon. Friend will be able to show some sympathy for them this evening.
First of all, then, we are trying to extend the exemption given in paragraph 6 of Schedule 6 to cover more people, those who are also handicapped in a way in which they cannot make use of books.


I have had one or two consultations about this. We are concerned with a relatively small number of people, people suffering from, for instance, multiple sclerosis, and others suffering from paralysis of one kind or another, and people who are temporarily handicapped and in hospital or other institution. The number of the people is relatively limited and that means that if we can make the concession it can be made at very little cost to the Revenue.
There is also the fact that the partial exemption extends to blind people using the talking book service. This exemption has served the blind community very well indeed over the years, but we live in changing times, and there are discussions going on at the moment about whether or not this service could be extended for use by other people, patients in hospitals, and it would seem odd if, because they are not blind they were excluded from the exemption given to blind people. With technological changes and new techniques there is the use of cheaper transistorised tape recorders, and the talking book service may become out of date, and in some ways it is already out of date.
There are at least two institutions providing a tape recorder service, the National Library, and another library providing a service for hospital patients and using closed tape recorders, that is to say, tape recorders which are not capable of recording. It provides a tape recorder on loan and supplies cassettes which can be fitted on the recorder, and which can be used for no other purpose.
It seems to me that this is a service which can bring light not only to the blind, but it can bring light, learning and enjoyment to very many sufferers. So I hope that the exemption, which we have had now for a while for the talking book service, can be extended to tape recorders.
That is the second Amendment. On this main Amendment, we are dealing with a much more difficult problem, and I appreciate that we are involved in special pleading.
There is a technological revolution which has produced small transistorised tape recorders which are now relatively cheap—or they were until the introduc-



tion of the 33⅓ per cent. Purchase Tax— and they have opened the eyes, as it were, of many thousands of blind people. It has opened them not only to the world of the talking book recorded by an actor or other reader on behalf of individuals, but it has opened up a world of communication which was closed to them before.
By means of these small recorders, which are relatively cheap, it is now possible for blind people to write a letter or message to a friend or relative in this country or elsewhere in the world, who can listen and record a reply. This has opened to these people a very wide world of opportunity for correspondence, for understanding, for sharing in the life of our society which is open to all of us and is largely closed to them.
I appreciate that we are asking the Treasury to devise a scheme by which people can get a rebate. We suggest in the Amendment that the method should be that a registered blind person or a person who can produce a doctor's certificate saying that they are totally incapable of using books, should be able to go to the Commissioners, having bought a tape recorded in the normal way, and ask for the Purchase Tax to be refunded. It is a substantial sum of money for many of these people. The amount involved may not be very great from the point of view of this House, but if one is blind or handicapped, and is buying one of these tape recorders, 33⅓ per cent. on the bill is a lot.
I am sure that my hon. Friend will find all sorts of technical difficulties with the Amendment, and that is why I do not want to press him on the words. I accept that we are engaged in special pleading, but we are pleading on behalf of a group of people who are denied a great many things which we accept as normal. We are denying, particularly, a growing number of blind people who use tape recorders, the opportunity to make contact with their friends and relatives. I hope that, while my hon. Friend may not be able to accept the wording, he will look seriously at our suggestions, and if he canot accept them will suggest other means by which we can help these people.

Sir G. Nabarro: I rise to support the hon. Member for Rushcliffe (Mr. Gardner)


and I want, first, to correct what I am sure was a slip on his part when, during his speech, he said that for the most part people who buy tape recorders are the young and the affluent. The people who buy most tape recorders today are businessmen and those interested in the improvement of business efficiency. The productivity of the average secretary is increased by 50 per cent. through the use of a tape recorder and discs of one kind or another.
There are always in all quarters of the House of Commons especially sympathetic and receptive ears for any measure to help the blind. This is one way of doing it, although I am not at all sure, in view of a letter that I have had from the Treasury about the posting of tapes between this country and other countries, that it would be practicable or possible for the Customs and Excise to deal with this matter in the fashion suggested. I propose to support this Amendment, if necessary in the Division Lobby, in the interests of the blind and I hope that my hon. and right hon. Friends will do the same.
I want to bring a particularly difficult aspect of the matter to the attention of the Financial Secretary at the outset. Shortly after Purchase Tax was put on the machinery, I received a complaint from a constituent in Malvern, saying that tapes which travelled between the United Kingdom and other countries, between members of the Voice Respondents' Club—an international organisation whereby men and women, including blind men and women, record their voices in the form of messages—were arrested by the Customs and Excise on entering this country, and only released on payment of the Purchase Tax on the tapes.

Mr. W. R. Rees-Davies: What a dreadful state of affairs.

Sir G. Nabarro: I quite agree with my hon. Friend, it is a dreadful state of affairs.
I took this up with the Financial Secretary and sent him the complaint from my constituent, drawing his attention to the obvious advantages, in the interests of international amity, of encouraging the Voice Respondents' Club. The Financial Secretary's reply was that, in future, would I arrange for members of the Club,



all over the world to mark the exterior of the packages containing the tapes with words to the effect that they are tapes with recorded messages? Will I accept responsibility for doing this? What drivelling rot!
Many blind persons are concerned in this traffic in tapes. This incident happened only 14 days ago, and it is one example of the extraordinary difficulties there will be in operating a system of unilateral discrimination and relief in favour of blind persons in the context of purchase tax on tapes and tape recorders. It all underlines the fact that it was a thoroughly iniquitous fiscal act to put Purchase Tax on this equipment at all.

7.15 p.m.

Mr. A. P. Costain: I congratulate the hon. Member for Rushcliffe (Mr. Gardner) on introducing this Amendment. I find it a little difficult to understand why he put it forward as a probing Amendment. The case is well made out, since talking books are exempted from tax. It should obviously be right for tape recorders to be exempted. I use tape recorders quite a lot for corresponding with my family in Australia, and I find them most effective. I do not expect relief from Purchase Tax, but, bearing in mind that blind people can correspond quickly and cheaply in this way without the services of another member of the family or without having to pay someone, it must be a good thing to allow them to have these machines free of tax.
I do not often disagree with my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), but I have found that any tapes that I have sent through the post, shown as tapes containing correspondence, have not been made liable to Purchase Tax. As a blind person would use only one or two tapes, which could be sent backwards or forwards, it would not be unreasonable they they should pay Purchase Tax on the tapes initially. A concession can and should be made in allowing the Purchase Tax on the machine. I am sure that the Financial Secretary will feel in a kind and generous mood and meet the demands of his hon. Friend.

Mr. Higgins: I am sure that the Committee feels that the hon. Member for Rushcliffe (Mr. Gardner) moved this


Amendment with the greatest sympathy and would agree with his motives. Like my hon. Friend the Member for Folkestone and Hythe (Mr. Costain) I am a little uncertain as to why he feels it should be a probing Amendment. The case which he deployed was extremely cogent and ought to be pressed if the Government are not prepared to concede it. If the wording of the Amendment is defective in some way, that can be remedied on Report and the Financial Secretary can indicate as much to us.
We feel that this is important. The hon. Gentleman rightly stressed the importance which has been attached to talking books, and the fact that these are specifically exempted within the terms of the Purchase Tax regulations. Technology is changing very considerably, and there are a great many recordings which may be of only transitory interest, but none the less of great topical interest to the blind.
The tape recorder which enables a tape to be used and then erased and something fresh circulated among the blind is a very important break-through. It would seem absurd to exempt a relatively obsolute form of technology, valuable though it is, and then not exempt the tape recorder. It is true that tape recorder prices have tended to fall, but the imposition of 33⅓ per cent. on the price to a blind person, many of whom are likely to be in the lower income group, is a very heavy imposition indeed. We ought to do all that we can to help.
One is a little uncertain as to exactly what the function of this recommittal stage is. We debated at great length in Committee the question of gramophone records, and the great delight which blind people derive from them was mentioned then. I hope that on Report we can return to the broader question of gramophone records, because in Committee not a voice was raised, apart from the Government Front Bench, against exempting blind people from payment of the Purchase Tax. I should have thought that the same would apply to the 50 per cent. tax on tapes.
On a later Amendment we shall come to the question of cassettes and similar items. We shall no doubt hear that there is difficulty in identifying the particular items which are used by the blind. One



would have thought that this could be arranged. It is always the case that if there is a will it is possible to find an administrative system, particularly when blind people are normally registered. I should have thought that there is no reason why the exemption should not be made for cassettes.
I therefore hope that if the Treasury reply is not favourable the hon. Gentleman would feel that this matter should be pressed to a Division. We on this side of the Committee shall not vote against the Clause, because we recognise that in the economic difficulties which have been created by the Government a very tough Budget has become necessary. But we shall vote against the Schedule, because we cannot support the Government's change in the structure of Purchase Tax.

Mr. Harold Lever: I may as well get off my chest once and for all the assertion of those hon. Members who suggest that in descending one or two steps from the back benches to the front I have suddenly sustained occupational hardness of heart. I think that the right hon. Member for Enfield, West (Mr. Iain Macleod) put it more accurately in The Times this morning when he suggested that I was in this respect a poacher turned poacher. I have not changed in the slightest in my sympathetic understanding—if I had it then, I have it now—for the taxpayer, direct or indirect.
Were it in this case simply a question of ceding the tax relevant to the Amendments I should have no difficulty in meeting my hon. Friend the Member for Rushcliffe (Mr. Gardner) and hon. Members on both sides of the Committee, who are very understandingly zealous to protect from taxation those who are handicapped, particularly people like the blind and invalids, who suffer a tyrant's stroke of fate from which the hale and the strong are exempted, and by contrast with which the miseries that afflict all of us in good health are minor indeed. I therefore approach the matter with the fullest sympathy.
All Governments have shown that they have wished to provide exemption of this kind. For example, all the talking book apparatus has already been exempted by the Government, as are tape recorders


specially adapted for the use of the blind. If my hon. Friend is talking of the development of a new kind of tape recorder specially adapted for use by the blind, or almost exclusively in its nature usable by the blind, which does not enjoy that exemption by reason of its novelty and so on, I shall certainly see what can be done to help.
We have always sought to meet the case for relieving of tax items which are clearly identifiable by their nature as being for the use of the blind or the handicapped. All kinds of things—even specially designed cutlery for the use of disabled people—have been exempted. This has been the work of both Governments.
The hon. Member for Worthing (Mr. Higgins) says that where there is a will there is a way, but the will must be measured in relation to good sense and the cost of administration. Once one allows the relief not on the basis of the design or nature of the goods but on the basis of the person who will use them, one is in very dangerous and uncharted country. Blind people are carried about in motor cars. They use all kinds of objects in common use, like gramophone records. We have never exempted these categories of goods because they are for use by the hale and the infirm alike. Where we can find a precisely definable quality in the article which enables us to say that it is adapted for use by a handicapped or blind person, I shall readily look at any concession required.

Mr. Costain: When a blind person uses a motor car it costs him no more than a person with sight. The difficulty here is that when a blind person writes a letter he must get someone else to do it. He may have to pay to have it written.

Mr. Lever: I was not dealing with the difficulty of the blind here, but the difficulty of meeting the Committee's good intentions towards them, namely that one cannot depart from the principle that the relief shall relate to an article identifiable in itself as being for the use of the handicapped. Once one does that, one imposes an obvious and almost impossible administrative burden.
The one exception was in 1945, when Sir Stafford Cripps allowed blind people freedom from Purchase Tax on wireless



sets. He made it clear that it was a wholly exceptional provision, and that to multiply such concessions would place an impossible burden on the Inland Revenue. Once one starts to do this, one must set up an administration for each kind of handicapped person's requirements, not for readily identifiable articles, but articles in general use by well and handicapped people alike.
That the burden is utterly impossible has been recognised by all Governments. That is why the hon. Member for Worthing must have a care when he says that where there is a will there is a way. I am the last type of Member to accuse hon. Members opposite of lacking the will to help blind people when they were in office. I am sure that they were as well intentioned as any hon. Member in the House, but did not think it reasonable to find a way. I am sure that their will is as strong as mine is, but they saw as strongly as I do the obstacles to finding a way which make it impossible for any Government to burden its revenue-raising apparatus with the detailed administrative provisions that would be required once we set upon this path, which has been refused by all Governments.

Mr. Higgins: Does the wireless concession still apply?

Mr. Lever: I understand that it does. It was made clear by Sir Stafford Cripps that this was a departure from what was always regarded by all Governments as an iron-clad rule. He made it on the understanding that it could not be used as a precedent, and that he would not budge an inch, and would not expect any Government to budge an inch, from this position. In fact, no Government have done so. For example, it was pressed on the Conservative Government that the concession should be extended to bed-ridden and crippled people. The Conservative Government, in my view rightly, refused to have the concession extended, not for lack of the will but because the way is inimical to good administration of provisions of this kind.
I have given my hon. Friend assurances that if he will show me articles which are specifically and of their nature designed for blind people, I shall not be slow to consider sympathetically whether they have been covered by exist-


ing rules, and if not to see how they may be covered.
I am grateful to him for raising the issue, because it enables the Committee to reinforce publicly the sympathy we feel for people in this situation, and strengthens my hand and that of my right hon. Friend in making such concessions within the general rule as can possibly be made. But I am afraid that I cannot go beyond that at present.

7.30 p.m.

Mr. Albert Booth: I always listen with considerable interest to my hon. Friend the Financial Secretary to the Treasury on matters such as this. Naturally, the Treasury's hands of horror are raised at the complications involved in administering a tax concession. One would imagine having heard of this horror on many occasions, that the Treasury's methods were simplicity itself. But if one raises tax problems on behalf of one's constituents, one finds that its methods are as complex, if not more so, than those of any other organisation.
I want to plead that here we may be justified in breaking the golden rule that one has to identify the object as something very specific. I accept that the rule has been equally applied by both sides, but I want to speak in a way which appeals not to both sides but to my hon. Friend, who is also a member of the Labour Party, which has made many attempts to define Socialism. The definition which appeals to me most is that of a system by which one gives according to one's ability and receives according to one's needs.
In the case of the blind, the need is for aid in communication. Of all the handicaps which can befall a person in modern life, probably the greatest are those which deny the means of communication. Communication is most important to leading a full life in the modern world, and as a result of technological developments it is inevitable that there will be a great many means of communication which can aid the blind or the handicapped but can also be used to help in a lesser degree many others and will therefore be purchased by those who are not handicapped.
The more we go on applying the rule of a clearly defined object for the blind, the less we will be able to grant this sort of special relief in taxation. The way indi-



cated by the Amendment is by no means difficult of administration. It is possible to have recourse in every local authority to a register of blind and handicapped persons. If the Treasury want a second check, I am certain that the sponsors of the Amendment would not object to further consideration being given to one.

Mr. Harold Lever: That is not the problem. My hon. Friend says that there are innumerable other articles in common use to which the same argument will apply, and I hope he will see that that argument, far from being favourable to his case, is inimical to it. There is no difficulty in checking on a man who is blind. The difficulty lies in checking on the article and who gets the benefit of its use afterwards.

Mr. Booth: I understand the difficulties and the reasoning of my hon. Friend's argument. I appreciate that there are many other articles which can be of benefit to the handicapped and non-handicapped alike but whose benefit to handicapped persons will be the greater. But I press this point because I think that it would be simple, if it were necessary to have checks against abuse, to make such checks. Obviously, if a blind person purchased 50 tape recorders a year, one would have reason to suspect his motives. But if the check were made with both the blind persons' register and the tax office, there would be a safeguard against abuse. I urge that some consideration be given to this matter.

Mr. Donald Dewar: I had not necessarily intended to intervene, but I was interested in the line of argument put by my hon. Friend the Financial Secretary. Perhaps I have more sympathy than my hon. Friend the Member for Barrow-in-Furness (Mr. Booth) with the difficulties. I accept that they are complex and present a real administrative barrier, but I must say that I regarded the Financial Secretary's performance with a small touch of cynicism.
I have the feeling that, if we had been looking at a much more straightforward suggestion for helping the blind, the Treasury would have resisted it on the different and more straightforward ground that it did not want to find the money. Let us take, for example, the


financial aid given to the deaf. There is a £100 tax allowance for them at a cost of just over £750,000 in a full financial year. This concession was suggested by the Royal Commission in 1954 and since then the purchasing power of money has altered sadly. I have been told in a Written Answer by the Treasury that the equivalent today would be about £150. I may be a horrible cynic and too sceptical, but I have the odd feeling that, if I were to put down an Amendment to bring this allowance to £,150, which would be well deserved, it would be resisted, not because it would be difficult to administer and too complex but because of cost.
I realise that the blind have been well treated in some respects. According to the Civil Estimates for the old Ministry of Labour for 1967–68 compared with 68–69, the grants to local authorities for the blind have gone up from £1½ million to £1,624,000. The grants to voluntary bodies have also gone up. Given our financial stringency, and the number of good causes which have been squeezed, this represents a concession for which the blind will be grateful, although the figures are still miserably low considering their difficulties.
Having said that, I still think that there is a case for trying to help these people and finding a way to give them a little more financial support and assistance. In a strange way, I would have been happier if my hon. Friend had made it clear whether he would have been prepared to make some concession which would cost money if such a proposal had been put in a more straightforward way than this Amendment. If the objections to the Amendment are administrative, I am prepared to support him because it is probably unworkable, but I would like an assurance that, if hon. Members put down an Amendment for a straightforward concession which would not offend his administrative mind, he would look at it at least sympathetically.

Mr. Gardner: I am grateful for the support of the hon. Member for Worcestershire, South (Sir G. Nabarro), the hon. Member for Worthing (Mr. Higgins) and the hon. Member for Folkestone and Hythe (Mr. Costain), but I am not sure that we would necessarily assist the blind and the handicapped by trooping through the Division Lobbies.



My concern was to have the debate and draw these problems to the attention of my hon. Friend the Financial Secretary and my right hon. Friend the Chancellor of the Exchequer.
I am also grateful for what my hon. Friend said about the existing concession. I was under the impression that the Schedule did not cover tape recorders specially adapted for the use of the blind, but if that is so I am happy with that concession and perhaps we can return to the subject later on. My hon. Friend quoted the concession given by Sir Stafford Cripps and the difficulties involved in that departure, but it is not enough to say that there are all kinds of things that blind people use. We are discussing here something rather special —a special instrument that they use and from which they can get greater advantage than do other people.
We are discussing an instrument which has had loaded on to it a very substantial new tax. We are not discussing a whole range of things; we are asking for a special concession on this one instrument. I appreciate that there are considerable difficulties, and it is for this reason that I wanted a discussion on non-party lines. I was impressed by the advice of my hon. Friend who mentioned the allowance for blindness. If these administrative difficulties are insurmountable, it is time we looked again at the blindness allowance in view of the recent tax increases. I want to look at other possible ways of helping blind and other handicapped people. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

Schedule 6

AMENDMENTS TO PART I OF SCHEDULE 1 TO PURCHASE TAX ACT 1963

Sir G. Nabarro: Mr. Yates, how nice to see you in the Chair, when we are debating a Purchase Tax Amendment. No hon. Member of the House has a longer experience of Purchase Tax troubles than you have.
I beg to move Amendment No. 25, in page 55, line 32, leave out from beginning to 'for' in line 35.

The Temporary Chairman (Mr. Victor Yates): It would be for the convenience of the House to consider also Amendment No. 28, in page 55, line 36, leave out '33⅓ per cent.' and insert '25 per cent.'.

Sir G. Nabarro: This Amendment was a paving Amendment to a number of succeeding Amendments in my name and the name of many of my hon. Friends dealing with the whole gamut of Purchase Tax and its reform. As Amendments Nos. 25 and 28 alone have been selected for debate, I am rather restricted in what I may say, for the purport of these two Amendments, when read together, is to deal only with the existing 33⅓ per cent. rate of Purchase Tax and to seek to bring it back to 25 per cent. I am sure I may have your indulgence, Mr. Yates, in saying that any references I may make in the course of my speech to other Purchase Tax will be of a passing and desultory character only and will not be dwelt upon by myself.
I have a long association with Purchase Tax matters, and during the period between 1958 and 1962 I was asking Parliamentary questions at the rate of 100 per annum, always confined to the two or three months before the Chancellor's Budget statement. The purpose of that exercise, spread over four years and not without a measure of success, was reformative in character and sought to make progress towards a single flat rate of tax. I was prepared that the tax should be levelled at wholesale and, therefore, continue to be called a Purchase Tax. I do not mind that at all, although other people called it a sales tax simply because it was on a single flat or uniform rate. That is merely a matter of verbiage.
The important consideration, which is the gravaman of my Amendments, is that in peacetime in Britain my philosophy for indirect taxation dictates that there is no such thing as a luxury. No manufactured article is more or less essential than any other manufactured article. My fiscal philosophy is that the manufacturers of all goods do two things. First, they contribute towards a policy of full employment, which my party strongly supports, and, second, they contribute to the export of British goods all over the world. Resting on those two tenets I say that there should be no discrimination in levels of Purchase Tax. There


should be only one rate of Purchase Tax.
I cannot, in a Finance Bill, because of the rules of the House, move to put Purchase Tax rates up. Thus, I cannot by any manoeuvre or contortion seek to raise the 12½ per cent. rate to 25 per cent., or the 20 per cent. rate to 25 per cent. I can only seek to bring rates down, and, to enable me to make this speech, my group of Amendments on Purchase Tax was designed to bring the 50 per cent. rate to 25 per cent. and the 33⅓ per cent. rate to 25 per cent. I deal, therefore, this evening only with the second of those considerations, 33⅓ per cent. to 25 per cent., while advancing a general principle throughout. I am not alone in my concept—

7.45 p.m.

Mr. Michael Alison: Would my hon. Friend allow me to intervene? Would he concede, in limiting himself to the category which he proposes to reduce from 33⅓ per cent. to 25 per cent., that it would naturally follow that any article which is now to be charged at 50 per cent. but which was formerly charged at 33⅓ per cent. he would likewise like to see moved back to 25 per cent. and not remain stationary at 33⅓ per cent.?

Sir G. Nabarro: That is so. I shall not dwell on it, as I should be tempted out of order if I did so.
I seek, in the passage of time, a flat rate of tax, whatever we call it, whether we call it a Purchase Tax levelled at wholesale, a sales tax levelled at retail, or whether it is analogous to the West German and French method, an added value tax, a broadly based indirect tax which does not discriminate between manufactured article and manufactured article, most largely because of the frightful complexities, anomalies and fiscal incongruities that are created by the processes of discrimination. I intend to dwell on those in the 33⅓ per cent. bracket in a few moments.
I said that I was not alone in this matter. I was not a member of the Finance Bill committee upstairs, but I was delighted to see that my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), used these words:
If one believes, as I do, that it is right to reduce direct personal taxation, wherever

possible, as we did before, and as we will do again, the logic of events drives one towards such taxes as the payroll tax and the value-added tax."—[OFFICIAL REPORT, Standing Committee A, 8th May, 1968, c. 531.]
I am quite unashamed of what I said about this matter. An added value tax suits Britain, and we ought to have it in this country. It would lead to a much broader base for indirect taxation. It would rid us of the appalling discrepancies and disparities that exist today as between, for example, the taxation of whisky, of cigarettes and of petrol, and in all the different rates of Purchase Tax on a whole range of manufactured articles. It would cause all manufacturers and services to conform to a single taxation system on a very broad base, yielding much greater revenue than the present revenue from indirect taxation, and enabling us to devote the surplus from indirect taxation, to the reduction of direct taxation. That will form the subject of a later Amendment which, I am glad to see, is selected.
Though the Chancellor of the Exchequer has many qualities, he does not share my views about fiscal propriety and simplicity. In his Budget statement on 19th March, he demonstrated that he is philosophically directly opposed to me in taxation matters. I will read the passage from his Budget speech because it demonstrates all this and has caused my Amendment. He said:
Here, I propose a relatively small increase of approximately one-seventh to bring them to a 121 per cent. rate of tax. The middle range includes confectionery, ice cream and soft drinks. Here I propose an increase of approximately a fifth, bringing them to a 20 per cent. rate of tax. The third rate, now 274 per cent., applies to motor cars and most durable consumer goods as well as to a wider range of luxury or substantially less essential goods. Here, I propose to split the rate. For motor cars, motor cycles, refrigerators, washing machines, etc., there will be a similar increase of approximately one-fifth to 33⅓ per cent. But I think that in our present circumstances it is desirable that there should be a new, much higher, rate for luxury and less essential goods. For these, therefore, there will be an increase of rather over four-fifths —to 50 per cent. This rate will apply to furs, jewellery and imitation jewellery, gold and silver watches and clocks, gramophone records, smokers' requisites, cameras and other photographic goods, pictorial reproductions, diaries, calendars and greeting cards, fancy and ornamental articles, perfumery, and various toilet preparations and requisites. Full details will be given in the White Paper."—[OFFICIAL REPORT, 19th March, 1968; Vol. 760, c. 280.]



That pronouncement was utterly retrogressive, and I castigate him for it. He moved in exactly the opposite direction from his predecessors, the Tory Chancellors who toiled mightily under the scourge of my whip year after year, causing those Tory Chancellors to contract the rates of Purchase Tax and reduce them in number.
You, Mr. Yates, sat though it all. I knew that I was doing well when you laughed at me, as you did so frequently, because you were afflicted in Birmingham as I was then afflicted in Kidderminster. When I started my campaign in 1958, there were seven Purchase Tax rates. The top end. was a rate of 90 per cent., on cosmetics, of course. Lipsticks were judged the most luxurious of all manufactured goods, as if women could do without them, anyway—

Mr. Dempsey: Of course they could.

Sir G. Nabarro: That may be the hon. Gentleman's view, but he is an eccentric, and we all know him. However, we on the Tory benches are normal lusty males, and we like our womenfolk wearing cosmetics, including appropriate shades of lipstick.
There were seven rates, ranging from 90 per cent. at the top on cosmetics down to 5 per cent. at the bottom. Over those four years, we contracted the rates and we brought the seven rates down to three. At the top, we had not 90 per cent. but 25 per cent. At the bottom, we had not 5 per cent. but 10 per cent., without prejudice to the total yield. The revenue from Purchase' Tax went up year by year. As the economy expanded steadily, prosperity rose, and that was all reflected in the yield from Purchase Tax.
It was progress towards a single taxing system and, had the Tories got back in 1964, as they nearly did, by now we would have had a single rate of tax.
I am not alone in observing these trends. I have a healthy regard for Mr. Samuel Brittan, the Economics Editor of the Financial Times, who wrote on " The emerging tax philosophy of Mr. Jenkins", a leading feature article on Tuesday, 9th April, these words:
The desire to shift from direct to indirect tax is part of conventional economic enlightenment, although none the worse for that. But an unconventional feature, which has so far escaped attention, is the way in which Mr. Jenkins has increased the number of Purchase Tax bands, and widened the range between the

highest and the lowest. When Mr. Jenkins got up there were three rates—11, 16½ and 27½ per cent. When he sat down there were four—12½ Per cent., 20 per cent., 33⅓ per cent. and 50 per cent. This is in sharp contrast to the whole direction of changes under previous Chancellors, which was to reduce the number of bands, narrow the differences between them and bring more commodities into the net. The aim was to transform the Purchase Tax gradually into something more like a general sales tax.
Thus the Chancellor is moving against the general stream of conventional thought in this important matter.
I want to say something about the yield, and then, I hope, a little about the anomalies which have been created. This year, the Chancellor has soaked the consumer very hard. On the Purchase Tax, the provisional outturn for 1967/68 was £747 million. Before the Budget changes for 1968–69, the revenue would have been £760 million. After the Budget changes, it had become £887 million. Thus the Chancellor has increased the amount of the Purchase Tax yield between last year and the present year by £140 million, or 16 per cent., which is a very large and swingeing impost on the consumer.
Last, I want to say a word about the extraordinary difficulties that have been created in the interpretation of the Purchase Tax Schedules. I do not propose to embark upon another 100 Parliamentary Questions on the Purchase Tax. I believe that I may be able to do it in a better way and may see tax reforms at an early date with the return of a Tory Government, who I believe will move in this matter in the first Budget after their return to power.
The present state of the Purchase Tax Schedules as a result of what the Chancellor has done is very unsatisfactory. For example, Table 1 of the Financial Statement, 1968–69, gives the proposed changes in taxation and lists all those items which are to go up:
The other goods previously chargeable at 27½ per cent., which it is proposed shall become chargeable at 33⅓ per cent., are as follows",
and then there is a long list.
Group 31 is:
Toilet requisites shown on page 7 as exceptions from the 50 per cent. charge under this Group.
Group 32 (b) is:
Toilet preparations shown on page 7 as exceptions from the 50 per cent. charge under Group 32 (a) and (b).



When one looks at the 50 per cent. charge, one finds language of this kind:
… brushes, combs, scissors, nippers, knives, razors, … mirrors, sponges, dental sticks and tooth-picks … perfumery and toilet preparations (other than soap made up for sale as toilet soap, soap substitutes made up for sale as substitutes for toilet soap, baby dusting powders, shaving creams, shampoos, dentifrices, eye lotions, mouthwashes and antiseptics, calamine lotions and similar alleviating preparations, unperfumed.
8.0 p.m.
I would find it extremely difficult—if not impossible—after years of study of Purchase Tax Schedules to determine what is the tax chargeable on any particular item of toilet preparation I picked up in a chemist's shop. Take, for example, that passage in Group 18:
wireless and television sets; valves and loudspeakers.
They are put up from 27½ per cent. to 33⅓ per cent. but
photographic cameras and enlargers; parts and accessories; unexposed sensitised photographic paper
etc., are up by 50 per cent. By what determination is it arrived at that the second group are 50 per cent. more luxurious than a television set or a radio? Who said so? Are they? I doubt it. Who has decided, other than a boffin sitting in a back room in the Treasury, for example, that the 50 per cent. rate shall apply to all articles designed for use in the waving, curling, setting, dyeing, tinging, bleaching, dressing or treating the hair, but not to drying machines and articles for heating the hair in the process of waving, curling or setting the hair? Hair waving and hair drying machines are in the 33⅓ per cent. rate. The machines are in the 33⅓ per cent. rate and the accessories for use with them are in the 50 per cent. rate.
It is no good the professor getting agitated; this is inconsequential fiscal nonsense and everyone knows it to be inconsequential fiscal nonsense. I could easily make up another 400 Purchase Tax Questions demonstrating the nonsense which runs right through all the Schedules today. They cannot be blamed on Tory Chancellors, for they were on the threshold of putting the whole position right gradually over the years. Now the present Chancellor has gone into reverse and made the whole position immeasurably worse than it was a year

before by the increase from 27½ per cent. rate partly to 33⅓ per cent. rate and partly to 50 per cent. without rhyme or reason. Traders everywhere are very indignant that this has been done.
I hope that my hon. and right hon. Friends will join me in the Lobby if we obtain no satisfaction on this important Amendment. It is the only substantial Purchase Tax Amendment that we are debating on Recommittal. I emphasise that I want two factors. I want a broad-based indirect system of taxation and I want absolute equality between manufactured goods. It is drivelling rot to say that a camera should be taxed at 50 per cent. but the Savile Row suit I am wearing should be taxed at 9 per cent.; that an ordinary Brownie camera is nearly six times as luxurious as this suit of clothes.

Mr. Nott: Does my hon. Friend realise that if he were wearing a mini-skirt he would have to pay no Purchase Tax at all?

Sir G. Nabarro: I am grateful to my hon. Friend. We could go on with this nonsense absolutely ad infinitum.
I am glad to see that the 50 per cent. rate of tax, as a result of removal of dressed fur skin, now includes the Australasian red opossum if undyed and in strips measuring not more than 9 inches in length and I inch in width will be exempt. Why has Australasian red opossum been singled out for this highly favourable and discriminatory treatment?
I leave these fiscal meditations with the hon. and learned Member the Minister of State. I hope that he will not attempt to defend them, but will draw to the attention of the Chancellor—who I wish were in his place—his fiscal aberrations in this context. I express the hope that if by some mischance he is in office next year he will set about remedying this dreadful state of affairs.

Mr. Nott: I congratulate my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) on his fascinating speech about the Purchase Tax anomalies. Long before I came to this House I heard of his reputation in this field and it has been a matter of the deepest regret to me that, until now, I have not had an opportunity of hearing him perform on this subject.
I want to concentrate my argument on a particular anomaly to which I made brief reference in my recent interruption. Before coming to the anomaly of the mini-skirt, however, I want to make some remarks; about my hon. Friend's speech. He is, I think, quite right when he says that in the attitude of the Chancellor and of my hon. Friends towards the Purchase Tax Schedule there is contained a basic difference in philosophy. I do not think my hon. Friends believe that it is the function of a Chancellor or a Government to try to instruct the British public or to try to interpret the public's choice in the market as between a luxury or an essential or a less essential article.
I read with amazement the Minister of State's speech on greetings cards in the OFFICIAL REPORT of the debate in Committee. I thought of the discussions in Committee upstairs trying to categorise whether greetings cards are a luxury or an essential item or a less essential item. It is not the function of politicians to try to lay down whether a particular commodity is a luxury or not. That is for the consumer to choose. What is a luxury to one is an essential to another.

Mr. Booth: Would the hon. Gentleman agree that the logic of his argument is that the Government should levy Purchase Tax on everything that is produced? That is the only way to escape from some discrimination.

Mr. Nott: Yes, I was about to say how much I agree that the only logical Tory attitude to the whole wide question of Purchase Tax is to have one overall sales tax. I certainly favour the French as opposed to the German system. We should get rid of these differentials between one product and another and go for one single rate, for a sales tax preferably in the form of an added value tax. There is, however, a substantial difficulty which will face the Conservative Party if it goes for this reform. If we have a single range of sales tax over all items there will be problems, and this is something which hon. Members opposite will recognise, for the poorer sections of the community. Therefore, if our party moves towards a general sales tax with a uniform rate as I hope it will, we have first to contemplate some form of negative Income Tax or some other means whereby we can ensure that the income of the poorer members of the community

does not fall below a certain minimum level.

Mr. Orme: We have had this argument put in great detail, but there is not the difference between his side and our Front Bench on this matter that the hon. Gentleman tries to make out. They are both moving towards a broader based form of taxation. Some of us on this side are opposed to that sort of broad-based taxation and voted accordingly in the Committee.

The Temporary Chairman: It is not a question of a broad-based tax or a single tax. We are discussing an Amendment and I should be glad if the hon. Member would address his remarks to the Amendment.

Mr. Nott: I was merely making a few comments on my hon. Friend's speech on the anomalies of Purchase Tax. I want now to deal with one particular anomaly which relates to Group I referred to in the section we are now debating under this Amendment. I intervened and suggested to my hon. Friend that if he were to change his clothes at any stage from a Savile Row suit to a mini-skirt this latter garment would bear no Purchase Tax at all.
This is extraordinary because one has heard consistently from the Chancellor and the Minister of State how in this Budget is was necessary to raise the maximum amount of revenue. If revenue is to be raised, and if he is talking about distinguishing between luxury and less essential items, it might be reasonable to assume that a mini-skirt would bear some Purchase Tax, but in fact it bears none at all.
Last weekend in my constituency I met a most proper lady who was approaching middle age—I may perhaps be being slightly kind to her. Anyway, she was of the age when one would anticipate that normally she would not wear a garment of this particular length. I asked why it was that she wore her hem so high above the knee, to which she replied that she was living on a fixed income and had become very poor since the Labour Government came to power. Because of Purchase Tax she found it less expensive to purchase miniskirts than skirts of normal length.
I inquired into this anomaly with the greatest interest and found in fact that mini-skirts bear no Purchase Tax at all because there is an exemption for garments and footwear of a kind suitable for children's wear. Therefore, they do not bear the rate of Purchase Tax of 11½ per cent., now to be raised to 12 per cent.; they bear none at all. I inquired why nothing had been done about this anomaly. I was told that it proved awkward to hold the balance between children and adults in defining what was of a kind suitable for children's wear. The only criteria could be length. I naturally asked whether the waist measurement could not be a criteria, to which the Department of Customs and Excise replied that this could not be so as some teenagers wore skirts known as hipsters and it was therefore not possible to distinguish by the waist; it was necessary to do so by the length.
8.15 p.m.
So the argument went round and round and we find the anomalous situation whereby the most fashionable garment— I do not know whether it is regarded as a luxury by the wearer but it is certainly regarded as a luxury in the eye of the beholders—is not taxed. Perhaps I should add that I would not personally like to see however, any increase in taxation which would act as a disincentive to the wearing of this admirable garment.

Mr, Alison: Surely an increase in taxation, or the application of taxation on a rational basis, would lead to a diminution in the length of the skirt.

Mr. Nott: Perhaps the Department of Customs and Excise would categorise such wear as being even less adult-like than it is at the present time. I merely quote this anomaly to support my hon. Friend and I would say that the present system is quite absurd. It leads to hundreds of anomalies and we have to pursue some means of overcoming the increasing number of categories, the increasing differentiation which the Government are making between luxury, essential and less essential items. I support the Amendment in an attempt to narrow the number of separate rates of Purchase Tax and support my hon. Friend in his wish that the Conservative

Party will move for the abolition of Purchase Tax and the adoption of one single sales tax, perhaps an added value tax.
We should then have to give careful thought to how to protect the poorer sections of the community against a substantial shift to a tax on necessities, food and other items which would be much more badly hit than now if an added value tax were to be imposed.

Mr. Stanley Henig: So far, Mr. Yates, you have been liberal in your interpretation of what is allowed on this rather limited Amendment and I hope you will continue to be liberal with me so that I can reply from this side of the Committee to some of the points made by the hon. Member for Worcestershire, South (Sir G. Nabarro), and to the hon. Member for St. Ives (Mr. John Nott).
It would seem so far that hon. Gentlemen on the other side prefer their ladies to wear lipstick and other false equipment whereas we on this side prefer the mini-skirt. It would appear to me that the skirts might be that little more essential than lipstick—but I defer to the hon. Gentleman's great experience in these matters.
The hon. Gentleman has justified his Amendment seeking to reduce the new 33⅓ per cent. to 25 per cent. on the ground that this will simplify the position for the day when we have a flat-rate sales tax. The substitution of this Amendment in the Finance Bill would not achieve that, we are talking about something rather broader than that. Hon. Gentlemen are putting forward the idea of a sales tax. Many on this side of the Committee would not be prepared to accept anything like this at a time when there are so many inequalities in income which means that people's expenditure must be very unequal. Many hon. Members on this side would prefer, rather than a sales tax, something like an expenditure tax which was proposed some years ago. A person who was spending £500 a year on consumption would pay no tax; a person spending £2,000 a year on consumption might be taxed 50 per cent. This is more the kind of thing we would like to see.

Mr. Higgins: Who suggested an expenditure tax?

Mr. Henig: I regret I do not know. I understand the purpose of the hon. Gentleman's interjection is to cast aspersions on a very distinguished economist. I regret that he should have made such an intervention.

Mr. Higgins: I was in no way casting discredit on anyone. If the hon. Gentleman will read the Standing Committee reports, he will see that I pay compliments to the gentleman he has in mind.

Mr. Henig: I am glad to hear that.
To return to the point made by the hon. Member for Worcestershire, South, he very engagingly said that all manufactured articles were treated the same. When he said that I wondered whether he had ever had the good fortune to read or see the play, " The Apple Cart", by that distinguished Socialist, George Bernard Shaw, in which, towards the end, it transpires that in that mythical age England's entire prosperity had come to be based on the export of a most important manufactured article, namely, Christmas crackers.
Doubt: was expressed in some quarters whether the rest of the world could not conceivably do without Christmas crackers. Indeed, many on this side would say that, for example, there is a great deal of difference between pots and pans and Jaguar and Rolls-Royce motor cars. That is because virtually everybody can afford pots and pans, but only a small and privileged section of the community can afford Jaguars and Rolls-Royces. In this sense, moves towards a flat-rate sales tax are socially regressive because the people harmed most are those who spend the least because they have the least.
Although it was not specifically mentioned, one example of the kind of consideration that we on this side had in supporting the chancellor's Budget referred to gramophone records, which were not increased to 33⅓ per cent but to 50 per cent. People do not have to buy the most expensive types of gramophone records. They can buy the cheaper varieties. Those who have a small amount of money to spend on gramophone records would do this.
The hon. Member for Worcestershire, South and his one supporter so far, the hon. Member for St. Ives, suggested that there is no such thing as a luxury. The hon. Member for Worcestershire, South asked how the Treasury define and categorise a luxury. In looking at what is a luxury, one must consider the aspirations of ordinary people. These change over time. A television set, 10 or 15 years ago, was generally considered to be a luxury. This is not the case now. I do not see why we should say it is a luxury if people do not think that it is. Nowadays people consider, rightly or wrongly, that it is a necessity.
A magnetic tape recorder, on the other hand, is regarded as a luxury for the simple reason that most people feel they cannot aspire to one. Some people can afford a magnetic tape recorder and a television, but the vast majority can not. They, therefore, choose that which is the more necessary article and, rightly or wrongly, the majority of people have settled on television.
Given that there are many items which people feel that they need and many items which are felt generally to be luxuries and can only be afforded by a few, in a state of affairs where the Government have to raise money in a variety of ways it is right to consider the possibility of taking relatively more from those who can afford relatively more and demonstrate this by the goods that they buy. For this reason, it seems wrong to say, " Let us put 10 per cent. on pots and pans, so that a pot or pan costing 30s. would mean 3s. tax, and just 10 per cent. on a £2,000 motor car." That would be wrong, because the person who buys the £2,000 motor car can obviously afford to pay tax at a much higher rate. This is the attempt which has been made in this Budget.

Sir G. Nabarro: The hon. Gentleman is miles off beam in this argument. There is no difference in the rate of tax on a £10,000 Rolls-Royce or a £500 Mini. The rate of tax is exactly the same. There are about 11 million motor car owners in this country. A motor car is not a luxury; it is a necessity. Yet it is taxed at 33⅓ per cent.—much higher than many other articles which, in many respects, axe much more luxurious.

Mr. Henig: In view of that, I am wondering whether the hon. Gentleman would join with me in putting down an Amendment on Report to the effect that the tax on motor cars costing more than £1,000 should be dealt with. If the hon. Gentleman will support me, I will willingly put down an Amendment.

Sir G. Nabarro: The hon. Gentleman shows a crass ignorance of Parliamentary procedure. It would be absolutely out of order, even unacceptable at the Table, to move an increase in Purchase Tax. If the hon. Gentleman knew his fiscal history, if he rested less on academics and more on assiduity in Parliament, he would know that the late Sir Stafford Cripps unilaterally reduced the Purchase Tax on Rolls-Royces and similarly expensive motor cars, because of the export trade and to encourage the home market for them. He reduced the Purchase Tax on the most luxurious of all articles in Socialist eyes to increase export potentialities. The hon. Gentleman should go home and do his homework.

Mr. Henig: The hon. Member for Worcestershire, South is aware of what the late Sir Stafford Cripps did in this case, but he will be the first to admit, under other circumstances, that the right hon. Gentleman was by no means always right. However, on that occasion I suspect that he thought he was right.
An argument often used is that high taxation on luxuries prevents exports. Frankly, in an age when manufacturers are often content to rely on the home market, and not bother about exports, this argument becomes increasingly anomalous and not in accord with the facts.
In conclusion, I come down to the spirit in which these changes in the system of Purchase Tax, to which the hon. Member for Worcestershire, South objects, have been made. The argument is not that the new system is without anomalies. It is impossible for any system of taxation to be without anomalies. Every time a change is made there must be anomalies, and it is the job of those making the changes to try to iron them out. But the spirit behind the changes has been that, at a time when there is a manifest economic crisis— and we can argue ad infinitum the responsibility for it—and the need to raise

a great deal of revenue, one has to look at the means by which it should be done.
One possible means might be an increase in direct taxation. That, at least, was ruled out this year. But the hon. Member for Worcestershire, South said that he would like the increase in indirect taxation to be spread equally across all forms of expenditure. If that were done, it would not fall equally on everybody; it would fall most heavily on those who could least afford to pay. In erecting, on the other hand, the system brought before us at this stage, the Chancellor had in mind a different criteria: that those who could afford the most, and demonstrated it by expenditure considered by their fellow citizens to be on luxuries, should pay the highest rate of taxation and, therefore, make the major contribution to the national revenue.
Bearing in mind social justice, this seems to be an unexceptional formula and one reason why I shall be only too delighted to vote against the Amendment.

8.30 p.m.

Mr. Alison: I warmly support my hon. Friend the Member for Worcestershire, South (Sir. G. Nabarro) in his powerful and cogent argument, because it seems to me that one of the most ludicrous and unsatisfactory aspects in the changes in Purchase Tax is the inequitable separation of the sheep from the goats. Some goods which hitherto have been taxed at 27½ per cent. go up to 33⅓ per cent. Some which hitherto have had to pay the tax at 27½ per cent. go up to 50 per cent. There is no rhyme or reason behind the Government's proposal.
In deploying my plea to the Minister around a particular item which lies within that group which has moved up to 50 per cent. I want to argue that any reduction which my hon. Friend may be successful in getting in the group which has gone up to 33⅓ per cent. must, in logic, since it comes from the same basic starting point, be extended up the parallel scale.
Perhaps I might draw the Minister's attention to an anomaly which stands in the strongest contrast to the anomaly to which my hon. Friend referred. Miniskirts, at one might call the ridiculous extreme, are exempted. This proposal is outdone in its injury and unsatisfac-toriness only by the fact that at the sublime end of the scale a commodity which



is of semi-educational, if no higher, value, namely, the so-called framed scripture text which is distributed for Sunday school purposes, to schools, and to other places of education, goes up from the 27½ per cent. category, not into the group we are discussing, but into the outer space of the full 50 per cent. maximum penal rate. Is it logical that framed scripture texts should be charged at the full penal luxury rate while mini skirts are exempted, and bookmakers are charged at the rate of 5 per cent.?
Perhaps I can tell the Minister what one framed scripture text might say and here I give a sound four-line fiscal injunction:
Render therefore to all their dues: tribute to whom tribute is due; custom to whom custom; fear to whom fear, honour to whom honour.
I do not think that there is much fear or honour to be rendered to the Government, but at least the injunction makes certain that custom is paid under the heading of Customs and Excise to those who levy it, and that tribute, in the form of taxation, it is enjoined, should be paid to the tax gatherer. The Government single out injunctions such as that for the maximum tax. I am certain that these texts have a most educational value, and it seems incredible that, to fit in with the fiscal policy of the Government, they should be penally affected.
In the light of this wide-ranging debate which my hon. Friend has so skilfully and cogently initiated and deployed, there should be not only this reduction from the rate proposed by the Government to that which my hon. Friend proposes, but it should logically be extended to all the other regions of increase which take their starting point from the present level of 27½ per cent. The Government should make a clean sweep of the present disabilities and anomalies of the system and get back to something which is fair and equitable. They should do this particularly in respect of framed scripture texts in order to bring about a right frame of mind in our society, and to encourage a truly educational purpose.

The Minister of State, Treasury (Mr. Dick Taverne): The hon. Member for Worcestershire, South (Sir G. Nabarro) brought out his whips and scorpions to chastise the Chancellor of the Exchequer for widening and increasing the bands

and differences between the bands of Purchase Tax. He and some of his hon. Friends have had a certain amount of fun with some of the anomalies. It is vital, in considering the Amendment, to look at the reasons why these bands were increased, and the number and the differences between them widened. The Chancellor faced the need to raise a large amount of tax. He decided that he would not place the burden of this on Income Tax, and if followed logically that he had to increase by a substantial amount the burden which was borne by Purchase Tax.
As I think the hon. Member for St. Ives (Mr. Nott) recognised, one of the disadvantages of increasing the amount of Purchase Tax is its regressive effect unless the tax is somehow or other made selective. Despite some of the things said by the hon. Member for Worcestershire, South, it is possible to distinguish between some items which ordinary people of all income groups have to use and to buy, and other items about which there is an element of choice.
Indeed, the hon. Member for St. Ives said that if there was to be a general sales tax, because of its regressive effects one would need to have ameliorating social measures such as a negative Income Tax to make up for the obvious injustice which a straight increase in sales tax or a straight increase in ordinary Purchase Tax would cause. So that to avoid the regressive effect of the kind of movement which the hon. Member for Worcestershire, South wants to see in the evolution of Purchase Tax, and to avoid the regressive effect of simply putting up Purchase Tax as it now exists, the Chancellor of the Exchequer chose to use Purchase Tax more selectively.
A powerful case has also been made out, and was made out by hon. Members opposite, against doing so; because just as there are disadvantages, on the one hand, in simply putting up Purchase Tax rates, so there are obviously certain disadvantages also in making the tax more selective. The disadvantages are those which have been pointed out and which to some extent are inevitable, because it is not possible to select neat, logical categories in which no element of dispute can arise, nor any incongruity or anomaly. This was already true of Purchase Tax as it was before.
I was worried when the hon. Member for Worcestershire, South referred to the Australasian red opossum. I was relieved to find that this related to an anomaly already present in the Purchase Tax system and was not in any way created by the Budget; nor was the special case of the mini-skirt. These anomalies were already there but I concede that if one creates four categories instead of three and if the differences between the categories are increased, then to some extent more anomalies arise and those anomalies become somewhat greater.
The Opposition made the most of this but essentially the whole point which has been debated and very well debated, in the course of this Amendment, comes down to a very simple choice which was brought out by hon. Members opposite and by my hon. Friend the Member for Lancaster (Mr. Henig). The Chancellor of the Exchequer faced a choice, if he was to avoid increasing Income lax, between relying more heavily on a regressive tax with more being paid on things which are undoubtedly essential—and if be had gone in the direction of the hon. Member for Worcestershire, South the burden would have been even more widely spread, with possibly a tax on food and on a number of items at present exempt about which there is no element of choice whatsoever; and, on the other hand, of being more selective making the tax less regressive but choosing in a subjective way.
Essentially, the issue at stake here is one of fairness; on the one hand going against logic, on the other following logic not in the strict sense but in avoiding certain anomalies which cannot be strictly defended in logic. But if one looks at the overall list there is very little doubt that when it comes to fairness the balance undoubtedly is in favour of the measures in the Finance Bill. Undoubtedly, it is true that those categories which now bear the highest rate of tax are those about which there is the largest element of choice; and undoubtedly it is true, also, that by and large the choice which the Chancellor of the Exchequer has made and which is enshrined in the Finance Bill is one which will make the use of the Purchase Tax less regressive and, therefore, will remove some of the objections which otherwise could have

been brought in and which, by and large, would have put a greater burden on Income Tax.

Mr. Higgins: I rise to support my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), who proposed this Amendment in his usual cogent and on this occasion I might almost say flamboyant manner; because there is no doubt that the case he made was a very powerful one. My hon. Friend the Member for St. Ives—I have not heard him speak before on this particular subject; I would have remembered if I had—brought out with great force the extraordinary anomalies which exist in the Purchase Tax structure. He was right to stress that the Government's policy of widening the bands and creating four instead of three is bound to accentuate the number of anomalies and their impact on those affected. The Minister of State fairly admitted this.
This must be a serious criticism of the Government's policy. We believe that the right tendency in the Purchase Tax structure is that which we pursued in office, of reducing both the number of classes and the differentials. The logic of events might then lead one to a value added tax, a discussion of which would be out of order, but we discussed in Committee the extraordinary way in which the Government raise Purchase Tax whenever the increased competition brought about by the abolition of resale price maintenance brings down the price of something.
It is clear that, in a number of categories—for example, motor cars and consumer durables—prices have been driven down by that competition and the Government are now raising them again. This has been a general effect of the Government's increases. I will resist the temptation to digress further on the question of mini-skirts, except to say that I saw a notice in the cleaners the other day saying, " Mini-skirts cleaned, Is. an inch". This might have some peculiar effects.
The crucial point is that the Government are distorting the overall pattern of consumption and making some value judgements. The Minister of State said that this was necessary to raise this vast amount of taxation. We recognise that, in the situation which they have created, the Government have to raise the largest



amount ever in a Finance Bill. That is why my hon. Friends did not vote against the Clause, which is concerned with Purchase Tax, although we shall vote against the Schedule, which embodies the anomalies.
It is bizarre that the Minister of State should advance this argument with no reference to the fact that, in the debates on last year's Finance Bill, the then Chancellor said that the situation could be " Steady as she goes," that there was no need for increased taxation, and, later, that everyone could look forward to an increased standard of living. Now, the hon. and learned Gentleman says that we have to accept all these anomalies and changes because of the economic situation. He said that they were making the tax less regressive—not that some things are luxuries and some are not, or that some classes can bear the tax better and will yield belter revenue, but that the tax must be made less regressive.
8.45 p.m.
This must imply that the Government have made a clear-cut basis on which they say that because certain goods are bought more by people with high incomes and that certain goods are bought more by people with low incomes, they can somehow grade the tax between the two. This also means that for someone whose preference for a certain item is greater or less than the normal, the tax system is having an effect on his pattern of consumption, which is a tax principle that should not be lightly introduced, certainly for the arbitrary list of items concerned.
This series of Amendments is designed to reduce the rate of tax from what used to be the old top rate of 33⅓ per cent. to 25 per cent. Among the goods covered in this category are items which now come into the tax system for the first time, including tape recorders and music reproduction instruments. Among these is a class of musical reproduction instruments used for producing background music in industry and for other purposes. I understand that these machines are largely designed for use either in industry, with the object of increasing productivity, or in hotels and similar places where they are likely to increase trade.
I will not digress on the province of the Secretary of State for Employment and Productivity or on the question of

the hotel industry. We recognise the urgent need to increase productivity and the valuable contribution which the hotel industry makes to our national economy, and particularly to the balance of payments. I hope, therefore, that between now and Report the Minister will look at this side of the matter—sound reproducing equipment used in industry and elsewhere, which can be readily identified—and consider allowing equipment in this category to bear the lower rate of tax.
I must add a word about motor vehicles, since the whole effect of the Government's policy this year has been to impose bigger restrictions and taxes, whether by way of petrol tax, vehicle licence duty or Purchase Tax, on those who drive. We should have a clear statement about whether the Government feel that the motor industry, particularly from the point of view of its tendency to export, is helped by having a healthy home market, which will not be helped by the increase in tax imposed by the Clause. It would have been helped and its overhead costs might have been more widely spread if the proposals of my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) were accepted.

Mr. Henig: Would the hon. Gentleman agree that in the last few months, and certainly since the announcement of many of the increases in taxation on the home sales of the motor industry, the export returns of the industry have been running at the highest level ever and that the industry is doing everything expected and hoped of it at the time of devaluation?

Mr. Higgins: At the time of devaluation and in the period immediately after it my hon. Friends and I argued that there was a strong case for using the Purchase Tax regulator. I appreciate that the hon. Gentleman takes a great interest in the export of motor cars. He will be aware that for a number of months following devaluation the export of motor cars fell substantially while the import of foreign motor cars rose substantially because the Government did not use that regulator. It has been a continual contention of my hon. Friends that had the Government used the Purchase Tax regulator earlier, the economy might


have been in a stronger position, so that the need to increase taxation now would have been less. It may be that the generally depressed state of the home market will lead to a position-we earnestly hope that it will not-when the industry will not be working at full capacity.
I am sure that it would be common ground between both sides that we would hope that everything which could possibly be done to encourage motor car exports would be done. All I am saying is that we have yet to hear a clear statement from the Government whether they think a healthy home market is or is not likely to bring about that state of affairs.

Division No. 219.]
AYES
[8.51 p.m.


Alison, Michael (Barkston Ash)
Goodhew, Victor
Osborn, John (Hallam)


Astor, John
Cower, Raymond
Page, Graham (Crosby)


Atkins, Humphrey (M't'n &amp; M'd'n) 
Grant-Ferris, R.
Pearson, Sir Frank (Clitheroe)


Awdry, Daniel
Griffiths, Eldon (Bury St. Edmunds)
Peel, John


Baker, Kenneth (Acton)
Hall-Davis, A. G. F.
Pink, R. Bonner


Bennett, Dr. Reginald (Gos. &amp; Fhm)
Hamilton, Marquess of (Fermanagh)
Pounder, Rafton


Berry, Hn. Anthony
Hamilton, Michael (Salisbury)
Powell, Rt. Hn. J. Enoch


Biffen, John
Harrison, Brian (Maldon)
Price, David (Eastleigh)


Birch, Rt. Hn. Nigel
Harvie Anderson, Miss
Prior, J. M. L.


Black, Sir Cyril
Hawkins, Paul
Pym, Francis


Boardman, Tom (Leicester, S.W.)
HeaW, Rt. Hn. Sir Lionel
Quennell, Miss J. M.


Body, Richard
Heath, Rt. Hn. Edward
Rees-Davies, W. R.


Bossom, Sir clive
Higgins, Terence L.
Renton, Rt. Hn. Sir David


Boyle, Rt. Hn. Sir Edward
Hiley, Joseph
Rhys Williams, Sir Brandon


Braine, Bernard
Hill, J. E. B.
Ridley, Hn. Nicholas


Brinton, Sir Tatton
Hirst, Geoffrey
Ridsdale, Julian


Brown, Sir Edward (Bath)
Hogg, Rt. Hn. Quintin
Rodgers, Sir John (Sevenoaks)


Bruce-Cardyne, J.
Holland, Philip
Rossi, Hugh (Hornsey)


Bryan, Paul
Homby, Richard
Royle, Anthony


Buck, Anthony (Colchester)
Hunt, John
St. John-Stevas, Norman


Bullus, Sir Eric
Iremonger, T. L.
Scott, Nicholas


Campbell, Gordon (Moray &amp; Nairn)
Jenkin, Patrick (Woodford)
Sharpies, Richard


Campbell, B. (Oldham, W.)
Jopting, Michael
Shaw, Michael (Sc'b'gh &amp; Whitby)


Carr, Rt. Hn. Robert
Kaberry, Sir Donald
Silvester, Frederick


Chichester-Clark, R.
Kimball, Marcus
Sinclair, Sir George


Clark, Henry
King, Evelyn (Dorset, S.)
Smith, Dudley (W'wick &amp; L'mington)


Clegg, Walter
Kirk, Peter
Smith, John (London &amp; W'minster)


Cooke, Robert
Lane, David
Speed, Keith


Cooper-Key, Sir Neill
Langford-Hott, Sir John
Stainton, Keith


Corfield, F. V.
Lewis, Kenneth (Rutland)
Stoddart-Scott, Col. Sir M. (Ripon)


Costain, A. P.
Loveys, W. H.
Summers, Sir Spencer


Craddock, Sir Beresford (Spelthorne)
Lubbock, Eric
Tapsell, Peter


Crowder, F. P.
MacArthur, Ian
Taylor, Sir Charles (Eastbourne)


d'Avigdor-Goldsmid, Sir Henry
Mackenzie,Alasdair(Ross&amp;Crom'ty)
Taylor, Frank (Moss Side)


Dean, Paul (Somerset, N.)
Maclean, Sir Fitzroy
Temple, John M.


Deedes, Rt. Hn. W. F. (Ashford)
Macleod, Rt. Hn. lain
Thatcher, Mrs. Margaret


Digby, Simon Wingfield
McMaster, Stanley
Tilney, John


Doughty, Charles
Maddan, Martin
Turton, Rt. Hn. R. H.


Drayson, G. B.
Maginnis, John E.
van Straubenzee, W. R.


Eden, Sir John
Marten, Neil
Wainwright, Richard (Colne Valley)


Elliot, Capt. Walter (Carshalton)
Maude, Angus
Walters, Dennis


Elliott,R.W.(N'c'tle-upon-Tyne,N.)
Mawby, Ray
Ward, Dame Irene


Errington, Sir Eric
Maxwell-Hyslop, R. J.
Whitelaw, Rt. Hn. William


Eyre, Reginald
Maydon, Lt.-Cmdr. S. L. C.
Williams, Donald (Dudley)


Farr, John
Mills, Peter (Torrington)
Wills, Sir Gerald (Bridgwater)


Fletcher-Cooke, Charles
Mills, Stratton (Belfast, N.)
Wilson, Geoffrey (Truro)


Fortescue, Tim
More, Jasper
Winstanley, Dr. M. P.


Galbraith, Hn. T. G.
Morgan, Geraint (Denbigh)
Wolrige-Gordon, Patrick


Gibson-Watt, David
Morrison, Charles (Devizes)
Woodnutt, Mark


Gilmour, Ian (Norfolk, C.)
Munro-Lucas-Tooth, Sir Hugh
Wylie, N. R.


Gilmour, Sir John (Fife, E.)
Murton, Oscar
Younger, Hn. George


Glyn, Sir Richard
Nabarro, Sir Gerald



Godber, Rt. Hn. J. B.
Noble, Rt. Hn. Michael
TELLERS FOR THE AYES:


Goodhart, Philip
Nott, John
Mr. Anthony Grant and




Mr. Hector Monro.

I do not want to detain the Committee any longer. We have had a good debate on this subject. I am convinced that the arguments put forward by my hon. Friend the Member for Worcestershire, South carry the very greatest weight. We do not believe that the widening of the rates and the increased anomalies are in the public interest, and I very much hope that my right hon. and hon. Friends will join me in the Division Lobby in support of my hon. Friend's Amendment.

Question put, That the Amendment be made: -

The Committee divided: Ayes 159, Noes 227.

NOES


Albu, Austen
Gordon Walker, Ht. Hn. P. C.
Morris, John (Aberavon)


Allaun, Frank (Salford, E.)
Gray, Dr. Hugh (Yarmouth)
Mulley, Rt. Hn. Frederick


Alldritt, Walter
Greenwood, Rt. Hn. Anthony
Murray, Albert


Anderson, Donald
Gregory, Arnold
Neal, Harold


Archer, Peter
Griffiths, David (Rother Valley)
Newens, Stan


Atkins, Ronald (Preston, N.)
Griffiths, E. (Brlghtside)
Norwood, Christopher


Atkinson, Norman (Tottenham)
Griffiths, Rt. Hn. dames (Lianlly)
Oakes, Gordon


Barnett, Joel
Hamilton, James (Bothwell)
Ogden, Eric


Baxter, William
Hamilton, William (Fife, W.)
O'Malley, Brian


Beaney, Alan
Handing, William
Orme, Stanley


Benn, Rt. Hn. Anthony Wedgwood
Hannan, William
Oswald, Thomas


Bennett, James (G'gow, Bridgeton)
Harper, Joseph
Owen, Will (Morpeth)


Bidwell, Sydney
Harrison, Walter (Wakefield)
Page, Derek (King's Lynn)


Bishop, E. S.
Haseldine, Norman
Palmer, Arthur


Blackburn, F.
Hattersley, Roy
Pannell, Rt. Hn. Charles


Blenkinsop, Arthur
Hazell, Bert
Park, Trevor


Boardman, H. (Leigh)
Heffer, Eric S.
Parker, John (Dagenham)


Booth, Albert
Henig, Stanley
Parkyn, Brian (Bedford)


Boston, Terence
Hilton, W. S.
Pearson, Arthur (Pontypridd)


Bottomley, Rt. Hn. Arthur
Horner, John
Pentiand, Norman


Boyden, James
Houghton, Rt. Hn. Douglas
Perry, Ernest G. (Battersea, S.)


Braddock, Mrs. E. M.
Howarth, Harry (Wellingborough)
Price, Thomas (Westhoughton)


Bradley, Tom
Hoy, James
Probert, Arthur


Brooks, Edwin
Huckfield, Leslie
Rees, Merlyn


Brown, Hugh D. (G'gow, Provan)
Hughes, Emrys (Ayrshire, S.)
Reynolds, Rt. Hn. G. W.


Brown,Bob (N'c'tle-upon-Tyne, W.)
Hughes, Roy (Newport)
Richard, Ivor


Buchan, Norman
Hunter, Adam
Roberts, Albert (Normanton)


Buchanan, Richard (G'gow, Sp'burn)
Hynd, John
Robertson, John (Paisley)


Butler, Herbert (Hackney, C.)
Irvine, Sir Arthur (Edge Hill)
Robinson, Rt. Hn. Kenneth (St.P'c'as)


Callaghan, Rt. Hn. James
Jackson, Colin (B'h'se &amp; Spenb'gh)
Robinson, W. O. J. (Walth'stow, E.)


Cant, R. B.
Jackson, Peter M. (High Peak)
Rodgers, William (Stockton)


Carmichael, Neil
Jeger, Mrs. Lena (H'b'n&amp;St.P'cras,S.)
Rogers, George (Kensington, N.)


Carter-Jones, Lewis
Johnson, Carol (Lewisham, S.)
Shaw, Arnold (llford, S.)


Coe, Denis
Johnson, James (K'ston-on-Hull W.)
Sheldon, Robert


Coleman, Donald
Jones, J. Idwal (Wrexham)
Shore, Rt. Hn. Peter (Stepney)


Concannon, J. D.
Kelley, Richard
Silkin, Rt. Hn. John (Deptford)


Conlan, Bernard
Kenyon, Cllfford
Silverman, Julius (Aston)


Crawshaw, Richard
Kerr, Mrs. Anne (R'ter &amp; Chatham)
 Slater, Joseph


Cronin, John 
Kerr, Russell (Feltham)
Small, William


Crosland, Rt. Hn. Anthony
Lawson, George
Snow, Julian


Crossman, Rt. Hn. Richard
Leadbitter, Ted
Spriggs, Leslie


Cullen, Mrs. Alice
Ledger, Ron
Summerskill, Hn. Dr. Shirley


Dalyell, Tarn
Lee, Rt. Hn. Frederick (Newton)
Swain, Thomas


Darling, Rt. Hn. George
Lee, John (Reading)
Swingler, Stephen


Davidson, Arthur (Accrlngton)
LEStor, Miss Joan
Symonds, J. B.


Davles, G. Elfed (Rhondda, E.)
Lever, Harold (Cheetham)
Taverne, Dick


Davies, Dr. Eynest (Stratford)
Lewis, Arthur (W. Ham, N.)
Thomas, Rt. Hn. George


Davies, Ifor (Cower)
Lewis, Ron (Carlisle)
Thornton, Ernest


Dempsey, James
Lomas, Kenneth
Tinn, James


Dewar, Donald
Loughlin, Charles
Tomney, Frank


Diamond, Rt. Hn. John
Luard, Evan
Tuck, Raphael


Dickens, James
Lyon, Alexander W. (York)
Urwin, T. W.


Dobson, Ray
McBride, Nell
Varley, Eric G.


Doig, Peter
McCann, John
Wainwright, Edwin (Dearne Valley)


Dunn, James A.
MacColl, James
Walker, Harold (Doneaster)


Dunnett, Jack
Macdonald, A. H.
Wallace, George 


Dunwoody, Mrs. Gwyneth (Exeter)
McGuire, Michael
Watkins, David (Consett)


Dun woody, Dr. John (F'th &amp; C'b'e)
McKay, Mrs. Margaret
Watkins, Tudor (Brecon &amp; Radnor)


Eadie, Alex
Mackenzie, Cregor (Rutherglen)
Weitzman, David


Edeiman, Maurice
Mackintosh, John P.
Wellbeloved, James


Edwards, William (Merioneth)
Maclennan, Robert
Wells, William (Walsall, N.)


Ellis, John
McMillan, Tom (Gasgow, C.)
Whitaker, Ben


Ennais, David
McNamara, J. Kevin
White, Mrs. Eirene 


Ensor, David
MacPherson, Malcolm
Wilkins W. A.


Evans, Albert (Islington, S.W.)
Mahon, Peter (Preston, S.)
Willey, Rt.Hn. Frederick


Evans, loan L. (Birm'h'm, Yardley)
Mallalieu,J.P.W.(Huddersfleld,E.)
Williams Alan (Swansea W)


Faulds, Andrew
Manuel, Archie
Williams, Alan Lee (Hornchurch) 


Fitch, Alan (Wigan)
Marquand, David
Williams, Clifford (Abertillery)


Fletcher, Ted (Darlington)
Mason, Rt. Hn. Roy
Williams, Mrs. Shirley (Hitchin)


Foot, Michael (Ebbw Vale)
Maxwell, Robert
Willis Hn. George


Ford, Ben 
Mikardo, lan
Winnick, David


Forrester, John
Millan, Bruce
Woodburn, Rt. Hn. A.


Fraser, John (Norwood)
Milne, Edward (Blyth)



Freeson, Reginald
Mitchell, R. C. (S'th'pton, Test)
TELLERS FOR THE NOES:


Galpern, Sir Myer
Morgan, Elystan (Cardiganshire)
Mr. Charles Grey and


Gardner, Tony
Morris, Alfred (Wythenshawe)
Mr. Ernest Armstrong.


Garrett, W. E.
Morris, Charles R. (Openshaw)

Question, That this Schedule be the Sixth Schedule to the Bill, put forthwith pursuant to Order [11th June]:—

Division No. 220.]
AYES
[9.0 p.m.


Albu, Austen
Galpern, Sir Myer
Morris, John (Aberavon)


Allaun, Frank (Salford, E.)
Gardner, Tony
Mulley, Rt. Hn. Frederick


Alldritt, Walter
Gordon Walker, Rt. Hn. P. C.
Murray, Albert


Anderson, Donald
Gray, Dr. Hugh (Yarmouth)
Neal, Harold


Archer, Peter
Greenwood, Rt. Hn. Anthony
Newens, Stan


Atkins, Ronald (Preston, N.)
Gregory, Arnold
Norwood, Christopher


Atkinson, Norman (Tottenham)
Griffiths, David (Rother Valley)
Oakee, Gordon


Bagier, Gordon A. T.
Griffiths, Rt. Hn. James (Llanelly)
O'Maltey, Brian


Barnett, Joel
Griffiths, E. (Brightside)
Orme, Stanley


Baxter, William
Hamilton, James (Bothwell)
Oswald, Thomas


Beaney, Alan
Hamling, William
Owen, Will (Morpeth)


Benn, Rt. Hn. Anthony Wedgwood
Hannan, William
Page, Derek (King's Lynn)


Bennett, James (G'gow, Bridgeton)
Harper, Joseph
Palmer, Arthur


Bidwell, Sydney
Harrison, Walter (Wakefield)
Pannell, Rt. Hn. Charles


Bishop, E. S.
Haseldine, Norman
Park, Trevor


Blackburn, F.
Hazell, Bert
Parker, John (Dagenham)


Blenkinsop, Arthur
Heffer, Eric S.
Parkyn, Brian (Bedford)


Boardman, H. (Leigh)
Henig, Stanley
Pearson, Arthur (Pontypridd)


Booth, Albert
Hilton, W. S.
Pentland, Norman


Boston, Terence
Homer, John
Perry, Ernest G. (Battersea, S.)


Bottomley, Rt. Hn. Arthur
Houghton, Rt. Hn. Douglas
Price, Christopher (Perry Barr)


Boyden, James
Howarth, Harry (Wellingborough)
Price, Thomas (Westhoughton)


Braddock, Mrs. E. M.
Howarth, Robert (Bolton, E.)
Probert, Arthur


Bradley, Tom
Hoy, James
Rees, Merlyn


Brooks, Edwin
Huckfield, Leslie
Reynolds, Rt. Hn. G. W.


Brown, Hugh D. (G'gow, Provan)
Hughes, Roy (Newport)
Richard, Ivor


Brown,Bob (N'c'tle-upon-Tyne,W.)
Hunter, Adam
Roberts, Albert (Normanton)


Buchan, Norman
Hynd, John
Robertson, John (Paisley)


Buchanan, Richard (G'gow, Sp'burn)
Irvine, Sir Arthur (Edge Hill)
Robinson, Rt. Hn. Kenneth (St. P'c'as)


Butler, Herbert (Hackney, C.)
Jackson, Colin (B'h'se &amp; Spenb'gh)
Robinson, W. O. J. (Walth'stow, E.)


Callaghan, Rt. Hn. James
Jackson, Peter M. (High Peak)
Rodgers, William (Stockton)


Cant, R. B.
Jeger, Mrs. Lena (H'b'n&amp;St.P'cras,S.)
Rogers, George (Kensington, N.)


Carmichael, Neil
Johnson, Carol (Lewisham, S.)
Shaw, Arnold (llford. S.)


Carter-Jones, Lewis
Johnson, James (K'ston-on-Hull W.)
Sheldon, Robert


Coe, Denis
Jones, J. Idwal (Wrexham)
Shore, Rt. Hn. Peter (Stepney)


Coleman, Donald
Kenyon, Clifford
Silkin, Rt. Hn. John (Deptford)


Concannon, J. D.
Kerr, Mrs. Anne (R'ter &amp; Chathars)
Silverman, Julius


Conlan, Bernard
Kerr, Russell (Feltham)
Slater, Joseph


Crawshaw, Richard
Lawson, George
Small, William


Cronin, John
Leadbitter, Ted
Snow, Julian


Crosland, Rt. Hn. Anthony
Ledger, Ron
Spriggs, Julian


Crossman, Rt. Hn. Richard
Lee, Rt. Hn. Frederick (Newton)
Summerskill, Hn. Dr. Shirley


Cullen, Mrs. Alice
Lee, John (Reading)
Swain, Thomas


Dalyell, Tam
Lestor, Miss Joan
Swingler, Stephen


Darling, Rt. Hn.George
Lever, Harold (Cheetham)
Symonds, J. B.


Davidson, Arthur (Accrington)
Lewis, Arthur (W. Ham, N.)
Taverne, Dick


Davies, G. Elfed (Rhondda, E.)
Lewis, Ron (Carlisle)
Thomas, Rt. Hn. George


Davoes, Dr. Ernest (Stretford)
Lomas, Kenneth
Thornton, Ernest


Davies, Ifor (Gower)
Loughlin, Charles
Tinn, James


Dempsey, James
Luard, Evan
Tomney, Frank



Lyon, Alexander W. (York)
Tuck, Raphael


Dewar, Donald
McBride, Nell
Urwin, T. W.


Diamond, Rt. Hn. John
McCann, John
Varley, Eric G.


Dickens, James
MacColl, James
Wainwright, Edwin (Dearne Valley)


Dobson, Ray
Macdonald, A. H.
Walker, Harold (Doncaster)


Doig, Peter
McGuire, Michael
Wallace, George


Dunn, James A.
McKay, Mrs. Margaret
Watkins, David (Consett)


Dunnett, Jack
Mackenzie, Gregor (Rutherglen)
Watkins, Tudor (Brecon &amp; Radnor)


Dunwoody, Mrs. Gwyneth (Exeter)
Mackintosh, John P.
Weitzman, David


Dunwoody, Dr. John (F'th &amp; C'b'e)
Maclennan, Robert
Wellbeloved, James


Eadie, Alex
McMillan, Tom (Glasgow, C.)
Wells, William (Walsall, N.)


Edelman, Maurice
McNamara, J. Kevin
Whitaker, Ben


Edwards, William (Merioneth)
MacPherson, Malcolm
White, Mrs. Eirene


Ellis, John
Mahon, Peter (Preston, S.)
Wilkins, W. A.


Ennals, David
Mallalieu, J.P.W.(Hudderfield,E.)
Willey, Rt. Hn. Frederick


Ensor, David
Manuel, Archie
Williams, Alan (Swansea, W.)


Evans, Albert (Islington, S.W.)
Marquand, David
Williams, Alan Lee (Hornchurch)


Evans, loan L. (Birm'h'm, Yardley)
Mason, Rt. Hn. Roy
Williams, Clifford (Abertillery)


Faulds, Andrew
Maxweil, Robert
Williams, Mrs. Shirley (Hitchin)


Fitch, Alan (Wigan)
Mikardo, Ian
Willis, Rt. Hn. George


Fletcher, Ted (Darlington)
Millan, Bruce
Winnick, David


Foot, Michael (Ebbw Vale)
Milne, Edward (Blyth)
Woodburn, Rt. Hn. A.


Ford, Ben
Mitchell, R. C. (S'th'pton, Test)



Forrester, John
Morgan, Elystan (Cardiganshire)
TELLERS FOR THE AYES:


Fraser, John (Norwood)
Morris, Alfred (Wythenshawe)
Mr. Charles Grey and


Freeson, Reginald
Morris, Charles R. (Openshaw)
Mr. Ernest Armstrong.

The Committee divided: Ayes 224, Noes 159.

NOES


Alison, Michael (Barkaton Ash)
Cower, Raymond
Page, Graham (Crosby)


Astor, John
Grant-Ferris, R.
Pearson, Sir Frank (Clitheroe)


Atkins, Humphrey (M't'n &amp; M'd'n)
Griffiths, Eldon (Bury St. Edmunds
Peel, John


Awdry, Daniel
Hall-Davis, A. G. F.
Pink, R. Bonnor


Baker, Kenneth (Acton)
Hamilton, Lord (Fermanagh)
Pounder, Rafton


Bennett, Dr. Reginald (Gos. &amp; Fhm)
Hamilton, Michael (Salisbury)
Powell, Rt. Hn. J. Enoch


Berry, Hn. Anthony
Harrison, Brian (Maldon)
Price, David (Eastleigh)


Biffen, John
Harvle Anderson, Miss
Prior, J. M. L.


Birch, Rt. Hn. Nigel
Hawkins, Paul
Pym, Francis


Black, Sir Cyril
Heald, Rt. Hn. Sir Lionel
Quennell, Miss J. M.


Boardman, Tom (Leicester, S.W.)
Heath, Rt. Hn. Edward
Rees-Davies, W. R.


Body, Richard
Higgins, Terence L.
Renton, Rt. Hn. Sir David


Bossom, Sit Clive
Hiley, Joseph
Rhys Williams, Sir Brandon


Boyle, Rt. Hn. Sir Edward
Hill, J. E. B.
Ridley, Hn. Nicholas


Braine, Bernard
Hirst, Geoffrey
Ridsdale, Julian


Brinton, Sir Tatton
Hogg, Rt. Hn. Quintin
Rodgers, Sir John (Sevenoaks)


Brown, Sir Edward (Bath)
Holland, Philip
Rossi, Hugh (Hornsey)


Bruce-Gardyne, J.
Hornby, Richard
Royle, Anthony


Bryan Paul
Howell, David (Guildford)
St. John-Stevas, Norman


Buck, Antony (Colchester)
Hunt, John
Scott, Nicholas


Bullus Sir Eric
Iremonger, T. L.
Sharpies, Richard


Campbell, Gordon (Moray A Nairn)
Jenkin, Patrick (Woodford)
Shaw, Michael (Sc'b'gh &amp; Whitby)


Carr Rt. Hn. Robert
Jopling, Michale
Silvester, Frederick


Chichester-Clark, R.
Kaberry, Sir Donald
Sinclair, Sir George


Clark Henry
Kimball, Marcus
Smith, Dudley (W'wick &amp; L'mington)


Clegg, Walter
King, Evelyn (Dorset, S.)
Smith, John (London &amp; W'minster)


Cooke Robert
Kirk, Peter
Speed, Keith


Corrfield F. V.
Lane, David
Stainton, Keith


costain A. P.
Langford-Holt, Sir John
Stoddart-Scott, Col. Sir M. (Ripon)


Craddock, Sir Beresford (Spelthorne)
Lewis. Kenneth (Ruthland)
Summers, Sir Spencer


Crowder F. P.
Loveys, W. H.
Tapsell, Peter


d'Avigdor-Coldsmid, Sir Henry
lubbock, Eric
Taylor, Sir Charles (Eastbourne)


Dean, Paul (Somerset, N.)
MacArthur, Ian
Taylor, Frank (Moss Side)


Deedes, Rt. Hn. W. F. (asford)
Mackenzei, Alasdair (ross &amp; Crom' ty)
Temple, John M.


Digby, Simon Wingfield
Maclean, Sir Fitzroy
Thatcher, Ars. Margaret


Doughty, Charles
Macleod, Rt. Hn. Iain
Tilney, john


Drayson, G. B.
McMaster, Stanley
Turton, Rt. Hn. R. H.


Eden, Sir john
Madden, Martin
van Straubenzee, W. R.


Elliot, capt. Walter (Carshalton)
Maginnis, John E.
Wainwright, Richard (Colne Valley)


Elliott,R.w.(N'Ctle-upon.Tyne,N.)
Marten, Neil
Walter, Dennis


Emery, Peter
Maude, Angus
Ward, Dame Irene


Errington, Sir Eric
Mawby, Ray
Whitelaw, Rt. Hn. William


Eyre, Reginald
maxwell-Hyslop, R. J.
Williams, Donald (Dudley)


Farr, John
Maydon, Lt.-Cmdr, S. L.C.
Wills, Sir Gerald (Bridgewater)


Fletcher-Cooke, Charles
Mills, Peter (torrington)
Wilson, Geofferey (Truro)


Fortescue, Tim
Mills, Stratton (Belfast, N.)
Winstantley, Dr. M. P.


Galbraith, Hn. T. G.
More, Jasper
Wolrige-Gordon, Patrick


Calbraith, Hn. T. G.
Morgan, Geraint (Denbigh)
woodnutt Mark


Gibson-Watt, David
Morrison, Charles (Devizes)
Wyile, N. R.


Gilmour, Ian (Norfolk, C.)
Munro-Lueas-Tooth, Sir Hugh
Younger, Hn. George


Gilmour, Sir John (Fife, E.)
Murton, Oscar
Younger, Hn. George


Glyn, Sir Richard
Nabarro, Sir Gerald
TELLERS FOR THF NOES:


Godber, Rt. Hn. J. B.
Noble, Rt. Hn. Michael
Mr. Anthony Grant and


Goodhart, Philip
Nott, John
Mr. Hector Momro.


Goodhew, Victor
Osorn, John (Hallam)

Clause 8

VEHICLES EXCISE DUTY: INCREASE OF RATES

Mr. Alison: I beg to move Amendment No. 3, page 7, line 26, at end insert:
(3) Vehicles designed wholly and exclusively for the carriage of containers, where such containers are designed for carriage by road, rail, and sea, shall be charged at the appropriate rate of duty specified in Table B, Part III of Schedule 7 of this Act.
I would, first, extend a welcome on the behalf of the Committee to the Parliamentary Secretary to the Ministry of Transport, whom we have not had with us hitherto, at least today, and whom we last saw as a very gloomy sun was rising

over the River Thames at 6 a.m. on 9th May, when he joined our deliberations on matters affecting transport. It says something for the rather extended discussion that we have had here, that, almost six weeks later, the representative of the Ministry of Transport should be back with us when we are still only half way through the Finance Bill.
The Amendment which I propose, and to which I hope the Parliamentary Secretary will give a sympathetic answer, as he is bound to be a rare visitor to the Committee, concerns containers. There are few topics which are more relevant to, or have a greater bearing upon, the pursuit of efficiency and productivity in the manufacture and distribution of the


products of British industry than the container revolution.
In order to sum up in a nutshell what I seek to achieve by the Amendment, I refer the Committee to two Tables in the Finance Bill. The first is Table A, on page 59, paragraph 4 of which refers to:
Goods vehicles not included in any of the foregoing provisions of this Part of this Schedule.
The second is Table B, on page 60, paragraph 3 of which refers to "Other goods vehicles".
My object is to seek to make certain that container purpose-built vehicles are charged under paragraph 3 of Table B and not, as is likely to be the case, under paragraph 4 of Table A, which contains rates and charges which are very much higher than in Table B.
I hope that it will not be an imposition upon the Committee if I remind them of the four types of commercial vehicle upon which containers can be placed. It is essential to get these categories of vehicles clearly into our minds in order to appreciate the changes which need to be made.
The first type of vehicle is the ordinary rigid frame lorry with a flat platform at the back, supported on a back and front axle, with two axles as a minimum. That is the commonest sort of lorry, upon which a container can simply be deposited. A vehicle of this type would be charged at present under Table A according to its unladen weight. A four-ton vehicle in this category, for example, would be charged at the rate of £135.
The second type is the slightly more complex articulated lorry, with an associated trailer, which is, strictly speaking, integral with the tractor unit which pulls it. It is the sort of trailer which can be detached, but which has no separate front axle to enable it to be dragged along on its own, and has to rest on an undercarriage which is dropped down.
In passing, I would point out that the first type of vehicle I referred to, the ordinary rigid frame flat platform lorry with a back and front axle, is probably likely to turn the scales unladen at a lower unladen weight, load for load, than the articulated vehicle, which will have a minimum of three axles, the rear axle


on the articulated trailer, the driving axle on the tractor unit and the front axle on the tractor unit. In the case of articulated vehicles, in the nature of things, there is likely to be a greater unladen weight than would be the case with an ordinary type of rigid-frame vehicle.
9.15 p.m.
The point in making the distinction is that the articulated vehicle is more convenient, more manoeuverable, more modern and better adapted to receive a container. Yet, in the nature of our taxation system for vehicle licences, there is a tendency at present for the articulated kind of vehicle to be discriminated against in favour of the rigid-frame vehicle, simply because there will always be an extra axle involved. Right at the outset, the container revolution tends to be discriminated against by an out-dated form of vehicle licensing.
I move from that to the third class of vehicle on which a container might be carried. It is the kind of vehicle referred to in Table B, where we read of goods vehicles used for drawing trailers. This third category is distinct from the articulated unit. It is the sort of massive road tractor and trailer which one occasionally encounters, in which there is a separate tractor unit on its own front and back axles and a separate trailer with independent axles. One finds them pulling tanks, vast transformers and other such units. Strictly speaking, it is a separate tractor and a separate trailer. These units are charged on a much lower rate of duty than the articulated lorry. In the case of the separate tractor, its rate of duty up to four tons is a £54 charge, as hon. Members will see from paragraph 3 of Table B.
Looking into the future and at those who increasingly will make their living in transporting containers about the country, I suspect that there is a built-in incentive for the future container vehicle to be not an articulated unit, which is probably the most manoeuvrable and economic kind of lorry on which to transport containers, but the separate trailer and tractor. The trailer itself does not have to be licensed at all, in which case duty has to be paid only on the separate tractor unit, which is very much less in terms of unladen weight than the articulated lorry. The tendency


will be for container operators to go for the separate tractor and trailer. Inherently, this is uneconomic. It means putting an extra axle on the road, with extra tyres and extra expense in construction—

Mr. Leslie Huckfield: Would not the hon. Gentleman agree that the whole purpose of using the semitrailer for containers is that, when the tractor unit moves away, the container on the semi-trailer can be left at a warehouse, port or other premises? That cannot be done with the draw-bar trailer, except with the trailer portion itself, so there is not the disincentive from semitrailers and the incentive to draw-bar trailers, as he suggests.

Mr. Alison: I suspect that there is substantial weight in what the hon. Gentleman says. However, if he studies the imbalances in the rates of vehicle duties applicable to those two distinct categories, he will see that they are so substantial as to outweigh the disadvantage about which he has spoken. For a four-ton unit, the differential is between £54 and £135, which is massive.
There is a fourth category of road vehicle, which is really the decisive point and for which the Committee should make special provision in the future. It is the articulated or semi-trailer vehicle which is purpose-built to take a container. The articulated trailing part is a light trellis framework with a minimum of its own structural existence. It is designed with the very minimum of material to take the four corners of a container. It is not intended to take any other sort of load and probably has no main platform base at the back. It is probably just a simple outline framework with a couple of strengthened in the form of trellis across the middle, designed to take a container and nothing else.
This must be the sort of vehicle of the future as the container revolution comes about. There should be a built-in incentive for the operators and manufacturers of road vehicles to develop this sort of articulated unit and not to go in for a rigid-frame lorry of the sort which probably has a lower unladen weight but is not nearly so manoeuverable or flexible in operation nor has the incentive for the trailer unit as at present charged under Table B.
If the Parliamentary Secretary could accept the Amendment and move from Table A to Table B this limited range of vehicles so that purpose-built articulated lorries would be charged at the rate of only £54 maximum unladen weight, this Committee could put its shoulder in an intelligent and rational way behind a move which would lead to greater flexibility in the output and distribution of British industry.

Mr. Leslie Hnckfield: The argument of the hon. Member for Barkston Ash (Mr. Alison) shows that he has not understood why articulated vehicles are used. The whole principle of using them is that one can detach the tractor unit from the trailer unit and keep the prime mover continually in use. This is one of the main reasons why the principle of articulation has been adopted. Another reason is that with a tractor and trailer unit which can be detached the driver can be detached from his load. It is then possible to have effective and more flexible trunk haulage operation than if the driver has to stay with his load because his cab is attached to the trailer.
For these two reasons, that one can have more flexibility and keep the tractor or prime mover moving, many operators, pioneered by British Road Services— the nationalised sector—have gone in for articulation.

Mr. Alison: I should like to clarify what obviously I did not make sufficiently clear. The rate of charge at present makes a distinction between the articulated unit in which the tractor unit is movable and the non-articulated unit in which the tractor and trailer are borne on independent axles. It is a question of moving the articulated unit into the same category as the tractor and trailer unit.

Mr. Hnckfield: Again, the hon. Member has misconstrued my argument. The articulated principle means that in all circumstances the driver in his tractor unit can be detached from his load. With the draw-bar trailer, although one trailer can be detached, if there is a second trailer on the mam bed of the lorry it cannot be detached from the driver.
It is because an operator who is using a semi-trailer can put two containers on



the same trailer, which can both be detached from the driver, that he will opt, despite some of the disincentives which have been referred to, for the fully-blown semi-trailer. It is not economic for any operator to have a system where he cannot detach the driver from the load as is the case with the draw-bar trailer.
The whole principle of container operation suggests that the operator will have to wait a long time at container ports, freight-liner depots and warehouses. He has to be in a position at all times to detach the whole of his load, which may involve two containers, from the trailer. With the draw-bar trailer he can detach only one container.

Mr. Alison: The second category was not what the hon. Gentleman described as a tractor unit with a built-in container space already on its back, but a separate tractor with no carrier unit at all—a Pickford's tractor without any carrying capacity, which is at present charged at a very much lower rate than the articulated tractor.

Mr. Huckfield: Having been at 45 sitting of the Standing Committee upstairs I appreciate the arguments put forward by the hon. Gentleman the Member for Worcester, South (Sir G. Nabarro) and other hon. Gentlemen, but I would still submit to this Committee that the hon. Gentleman has not understood the basic principle of articulation, which is that it is possible to leave a couple of containers. It is possible to carry two containers on a semi-trailer where it is skeletally possible, and to leave two containers behind. If he studies the way articulation works in practice he will find he is talking nonsense.

Mr. G. Campbell: I would like to support the principle of the Amendment which has been so ably moved by my hon. Friend the Member for Barkston Ash (Mr. Michael Alison). I am glad to follow the hon. Member for Nuneaton (Mr. Leslie Huckfield). I know and respect his experience in road transport. I am glad that he was in agréement with our side of the Committee on some of the more important points where we tried to change the Transport Bill, but he has failed to understand the purpose of this Amendment.
The Government ought to make sure that in the Bill they are not penalising containers. There has been and is still taking place a container revolution. Those of us who were inured in the Transport Bill Committee for so long were worried that the Government did not seem to have caught up with the container revolution. The freightliner service of British Railways, which was started five or six years ago with the support of the Conservative Government and which was held up by the disputes over the entry of road transport to the terminal, demonstrated how containers could revolutionise and speed up the transport of freight.
Now the Government are committing, or attempting to commit, the folly of taking the freightliner service away from British Railways—the most profitable go-ahead and developing part of the freight service. This is very much in accordance with the Amendment, because the transferability of the container from one kind of transport to another is one of its essential advantages.
9.30 p.m.
I was seeking, by way of illustration, to show to what extent the Government have failed to catch up with this container revolution which is now going on. It is important that we should ensure that there is no discrimination against the development of the container system.
To illustrate my point, I will turn to another side of transport and the use of the container. This is the present development of what is know as cellular shipping—the container ship which is being specially built with many compartments so that, if cut across as a section, it would look like a beehive. There is no doubt that lessons are being learned from the insect world in the construction of these ships. The way in which they are being constructed is similar to the storage arrangements of the bees and the ants.
These ships, together with the road and rail transport, will mean very much lower costs in the transport of freight across land and water. The great advantage of the container system is that it is easy to transfer from one means of transport to another. It is essential, therefore, that there should be fair treatment with similar forms of transport, such as



trailers. That is why this Amendment seeks to move this form of transport to Table B of Part III of Schedule 7 for the purposes of taxation.
I recognise that there are several variations. The dialogue and exchange which occurred between my hon. Friend the Member for Barkston Ash and the hon. Member for Nuneaton made clear that there are different systems—articulated systems of trailers and semi-trailers and so on. I recognise that this matter is complicated. But what worries me is that the Government do not appear to have looked into it. It is essential that this should be done.
I now turn to another point which particularly affects trade and industry in Scotland; the question of containers which travel only by road. There are special forms of container which travel only by road, such as refrigerated containers carrying meat. Meat-producers have found this a much better way of sending meat, other than sending live animals. It is important, therefore, that refrigeration should be included in their method of transport. The same considerations apply to the transport of fish.
Containers are being increasingly used for special packing and for moving without danger of breakage. This is the kind of point which the hon. Member for Nuneaton was making in Standing Committee so I hope that he will support us on this Amendment.
In the light of this container revolution, have the Government really examined the taxation which they are now proposing in the Bill? It seems doubtful whether they have. The Minister was not one of those taking part in our marathon on the Transport Bill, but I hope, none the less, that he followed the discussions that we had. I hope this evening that the hon. Gentleman will explain the Government's attitude and whether they have looked into this, or, alternatively, will accept the principle of this Amendment.

Mr. Paul Hawkins: I support my hon. Friend the Member for Barkston Ash (Mr. Alison) in the Amendment which he has just moved.
I have a personal interest in this container revolution, because one of the major firms making containers and, for


that matter, making the vehicles to carry them, Crane-Fruehauf, has its headquarters in my constituency at Dereham.
A few weeks ago I went to the Container Exhibition at Olympia, which was put on by the Port of London Authority, Overseas Containers Ltd. and others. I think that it is acknowledged on both sides of the Committee that containers will produce a tremendous revolution in transport by road and by sea. I understand that shortly Australia will not accept many goods unless they arrive in containers. I appreciate what the hon. Member for Nuneaton (Mr. Leslie Huck-field) said about articulated vehicles having a built-in advantage, but there is no reason why this type of vehicle should be penalised in relation to those which, although used for carrying containers, do not have the same advantages, by carrying the higher rate of duty.
I support the Amendment because I believe that we should encourage modern means of transport, and these containers are probably the most modern means at our disposal. I believe that Britain is in the forefront of the container revolution, and this proposal is one small means by which we can keep Britain there.

Mr. Ridsdale: I feel rather like an amateur among a number of professionals when I hear references to what happened in Committee upstairs. I wish that we could have avoided this situation by discussing the legislation on the Floor of the House rather than upstairs.
My constituency has a direct interest in containers, because it has an important container port not only for British Railways but for private enterprise, at the Harwich Navy Yard, and also on the opposite shore at Felixstowe. It is said that we are in the forefront of the container revolution, but I think that the contrary is true. We have not moved nearly fast enough. Other countries have moved far more quickly than we have, and it is because of this that I ask the Minister to ensure that we get all the advantages that are possible from this form of transport.
I listened with interest to the lucid speech of my hon. Friend the Member for Barkston Ash (Mr. Alison), and I could not help but feel that the hon. Member for Nuneaton (Mr. Leslie



Huckfield) has been so concerned with some of the technicalities that he cannot see the wood for the trees.

Mr. Leslie Huckfield: Mr. Leslie Huckfield rose—

Mr. Ridsdale: I propose to make only a short speech, and I heard what the hon. Gentleman had to say.
I hope that the Minister will adopt a progressive attitude, and say that our taxation system must provide advantages for this new means of transport. I hope that he will pay attention to the lucid arguments advanced by my hon. Friend the Member for Barkston Ash. I hope that he will ensure that our transporters derive benefits from the Government's policy, and will not have to continue with the disadvantages which they now have to bear to far too great an extent.

Mr. James Tinn: It is wrong for hon. Gentlemen opposite to imply that the Government, or indeed anyone on this side are less seized than they are of the importance of developing container traffic. I know that on the Tees in my constituency it is being developed vigorously, and I hope that it will be expanded.
I was rather taken with the logic of the hon. Member for Barkston Ash (Mr. Alison). I find it hard to understand why there should be this tax differential between two kinds of trailer, one with two wheels which is coupled to an articulated vehicle, and one which has four wheels. I shall wait with interest to hear my hon. Friend's explanation for this anomaly.
When one recognises the anomaly, it is perhaps not quite so logical to talk solely in terms of the container traffic industry, because this seems to be something which applies equally over the whole of the road haulage industry.
Indeed, if there is something which needs to be put right, I would have thought redress would have to be applied over the whole of the industry. Certainly, from my own observations in my constituency, the tendency seems to be to use the four-wheeled trailer, which I understand is taxed at a lower rate—and that may be one reason—and which also seems to have the advantage that an additional trailer can be coupled to it, making it a two-load unit. This also


seems to be the modern trend, although as a motorist I am not keen on seeing more and more of these transport trailers on the road. I cannot quite see that the burden is as considerable as the hon. Member for Barkston Ash appeared to be suggesting, but at the same time I recognise what appears to be an anomaly and I shall be interested in my hon. Friend's explanation.

Captain Walter Elliot: I would certainly be ruled out of order and I am sure I would not be popular with hon. Gentlemen if I went into all the details of the Transport Bill which was discussed upstairs. I was filled with admiration for the skilful manner in which my hon. and right hon. Friends endeavoured to reduce that Bill to good sense, but my overall impression of it was that after all the arguments the Government still failed to recognise what I believe is well known—that the transport industry is an integral part of the production line of industry. It has always seemed to me that although this country lacks many natural advantages we have inherent advantages in so far as transport is concerned. We have short hauls to our ports and airfields, and many ports well situated to supply and receive from overseas countries, with good deep water and facilities; and we should do our utmost to develop these advantages to assist out exports.
As my hon. Friends have already said, there is no doubt that the most revolutionary development in transport technique is the development of containers. I myself, I suppose naturally, am rather interested in ships and shipping. We know that tens of millions of pounds are being spent in developing special container ships and special ports for handling containers. This is a vast development. While we may not agreed with their methods I admit that the Government have by various measures and by building up certain departments, endeavoured to encourage British industry to greater efficiency. But for what appear to me to be illogical reasons they seem to be intent on squeezing the transport industry into a framework with scant regard for its efficiency. It will be a dreadful mistake if anything is done to check the development of the container system whether on sea or land; and certainly the two must go together.
It is no good shipowners or port authorities spending these vast sums of money on developing their container ships and facilities if the parallel development does not go on with container vehicles ashore. Here is a sphere in which I am quite sure the Government should, as it has done in other spheres in industry, give real encouragement to the development of container vehicles. My hon. Friend put the case; extremely well and if the Amendment is accepted it will encourage this development on land, parallel with the great developments at sea and in the ports. That is why I support it and hope that it will be accepted.

9.45 p.m.

Mr. Costain: I was surprised that no attempt was made to reply to this interesting debate. I am seriously concerned when a Government use taxation to delay progressive developments—

Mr. Leslie Hnckfield: Oh.

Mr. Costain: The hon. Member makes extraordinary noises, and he also makes extraordinary speeches. He refers to my hon. Friends as speaking nonsense. He may have some experience of transport, but he is not the only hon. Member who has.

Mr. Huckfield: Does the hon. Gentleman not realise that the cost advantage of using an articulated semi-trailer far outweighs the tax disadvantage to which his hon. Friends refer?

Mr. Costain: Are we talking about efficiency or about the maximum taxation which a Government can apply to an industry? The hon. Member argues that, because one form of trailer is taxed less than another, that is all right. My view is precisely the opposite. How will we get the most efficient transport system? In the near future, the Channel Tunnel will be operating with a type of transport depending very much on the trailer principle and I am anxious to hear what co-ordination has gone on with the lorry manufacturers.
My early experience in charge of a transport fleet showed me that a great deal of development was restricted in motor lorries—[Interruption.]—the hon. Member laughs, but I can go back to the steam trailer, when development was handicapped by high taxation. What consultations have the Government had with


the manufacturers, who are doing so much for our exports? How will our taxation system compare with that of the Continent? In the near future, there will be interchange of these lorries, and I wonder whether we will be at a disadvantage with foreign operators. [Interruption.] Again the hon. Member finds this amusing. I am sorry that he does, since this is one of the most serious factors for our exports. I hope that the Parliamentary Secretary will not let the debate go by default. I intend to vote for the Amendment.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Bob Brown): When I first looked at the Amendment, I wondered what it was trying to do. I thought that it was to remove containers from the reckonable weight in assessing the excise duty payable, but, from the speech of the hon. Member for Barkston Ash (Mr. Alison), whom I thank for his kind remarks in opening, it was clear that this was not one of the intentions. Do hon. Gentlemen opposite intend to create new concession rates for vehicles using containers? The hon. Member for Barkston Ash tried to argue this case by referring to the four categories of vehicle.
The hon. Gentleman is labouring under a considerable misapprehension about what the Schedule does. All types of container-carrying vehicle receive a substantial tax relief, and under the 1966 Act the demountable body is not taken into account for taxable weight. This applies if the vehicle is in category one, a platform lorry; in category two, an articulated lorry; in category three, a platform lorry plus fixed towbar with trailer; or category four, a special purpose-built vehicle.
The hon. Member for Barkston Ash is under a misapprehension in referring to category three vehicles. He referred to large road tractor and trailer vehicles and described them as tank transporters. He made great play with the subject of the drawbar trailer and gave the impression that hauliers would be turning to this type of vehicle in the next month or so—that we would have nothing but huge tank transporters rumbling up and down the motorways. This is a ludicrous suggestion and I cannot believe that the hon. Gentleman seriously meant it.
The hon. Gentleman seemed to believe that this type of vehicle, the tank transporter, would be taxed at £54 under Table B. In fact, it will be charged £135 under Table A (4) and £54 under Table B (3), making a total of £189. If we were to simply charge on the basis of Table B (3), what would be the result? The basic goods rates under Table A go up in ¼-ton steps, while the supplementary trailer rates, which the Amendment seeks to apply as the basic rate for goods vehicles designed wholly and exclusively for the carriage of containers, are in a much broader taxation band.
In addition, while the basic rates have no upper limit, the supplementary trailer rates have, and it is interesting to make a comparison between the basic goods rates proposed by the Government and those proposed by the Amendment. A 1½-ton vehicle will be paying £49 10s 0d., while the rate proposed by the Amendment is £14; a 4-ton vehicle will pay under the Government proposal £135, while the rate proposed by the Amendment is £40; and a 10-ton vehicle will pay £459 while the Amendment proposes £54. I cannot believe that hon. Gentlemen opposite are seriously suggesting that the Government should accept a proposition which would mean such a calamitous loss of revenue. Indeed, I wonder how the constituents of hon. Gentlemen opposite would feel if they knew that their representatives were asking that the owner of a 2½-ton vehicle should be allowed to pay £1 less, £24, in Excise Duty than ordinary drivers are being asked to pay, £25, for private vehicles? I am quite certain that the average car owner is certainly not going to be enamoured of this type of proposition.
I think the Amendment should be resisted, first because it is certainly badly drawn whatever its object may be. I am sure there is considerable confusion in the mind of the hon. Member who moved it. It is completely unacceptable in particular because container vehicles already have the benefit of the weight of the container being ignored for the purpose of assessing duty.

Mr. Alison: I am grateful to the hon. Gentleman for seeking to throw light on this. It is only light I am seeking. Could he help in this particular? Is a vehicle


of unladen weight of four tons, which has a hook at the back so that it may be linked to a separate trailer, at present licensed under paragraph 4 of Table A— a four-tons unladen weight vehicle at £135—a platform lorry with capacity for taking a trailer—or is it taxed under paragraph 3 of Table B at £54, or is it taxed at both together? This is what I am not quite clear about. Perhaps the hon. Gentleman would clarify that for us.

Mr. Brown: The vehicle is taxed under both Tables, because Table B is really an additional tax upon the trailer itself: the trailer cannot be taxed so the vehicle is taxed. Depending on the weight of the trailer, this is an additional rate of duty, set out in column 4 of Table B, and that duty is appended to the vehicle taxed in Table A.

Mr. Alison: I am genuinely seeking light on this. What is the taxable position, therefore, of the separate Pickford's tractor unit with no trailer attached to it at all, the small tractor unit used for hauling a tank transporter, for example? Is it assessed separately? It must be, we assume, otherwise the weight would go up to beyond four tons, which is the maximum weight under paragraph 3 of Table B. What is the rate of taxation on one of those separated tractor units which has no carrying capacity of its own?

Mr. Brown: The mechanical horse, which is really what we are referring to, would be taxed under Table A.
The Amendment is unacceptable to the Government because, assuming that its drafting were right, it would lead to, applying to container vehicles a duty which would be much too low, as I have indicated. It would be completely unfair to the transport industry as a whole.
Do not let anyone leave this Committee to night with the impression that the Government are not anxious to do all in their power to facilitate the container revolution. I do not think anyone can point a finger at this Government and say that we have done anything other than give great encouragement to the container revolution.

10.0 p.m.

Mr. Patrick Jenkin: I am sure that the Committee



is grateful to my hon. Friend the Member for Barkston Ash (Mr. Alison) for bringing this matter to our attention. It has produced an interesting debate. I found it a little difficult to remember that we were debating the Finance Bill, and not the Transport Bill, the presence beside me of my hon. Friend the Member for Worcester (Mr. Peter Walker) for most of the debate served to heighten the illusion.
The debate has demonstrated the value in these matters, technical though they may be—and the Parliamentary Secretary's reply has demonstrated the degree of technicality—of having a debate in the Committee of the whole House and not upstairs. We have had a number of valuable contributions, from my hon. Friend the Member for Moray and Nairn (Mr. G. Campbell), who has great knowledge of shipping developments, from my hon. Friend the Member for Norfolk, South-West (Mr. Hawkins), who has a strong constituency interest in the construction of these trailers which are the subject matter of the Amendment, and from my hon. Friend the Member for Harwich (Mr. Ridsdale), who represents one of the most important of the container ports, which is playing an increasingly valuable part in our overseas trade.
We also had the advantage of a contribution from the hon. Member for Nuneatcm (Mr. Leslie Huckfield). I understand that he has spent a substantial part of his working life in the industry before coming to the House. He was able to make a worth-while contribution. Although he said that my hon. Friend the Member for Barkston Ash had misconstrued one of the provisions of this not altogether easy part of the Seventh Schedule he, speaking from very much greater knowledge, fell into exactly the same trap, because the objection he sought to raise against my hon. Friend's Amendment bore little relationship to the answer given by the Parliamentary Secretary.
We on this side do not have the resources that are available to Ministers to draft Amendments, and I hope that his criticism that my hon. Friend's Amendment was badly drawn will not count against him. It was clear that the Parliamentary Secretary and his advisers had not appreciated my hon. Friend's case. There was a suggestion that the


Amendment was directed towards relieving from tax the container which rests upon a trailer. My hon. Friend made it clear that his Amendment was not directed to that at all, and it is difficult to see how it could have been.
What comes out of this debate is the general view held about the value of developments in the container revolution. This was shown by the support which my hon. Friend's Amendment attracted from the hon. Member for Cleveland (Mr. Tinn). This is of great importance to this country, which has such a high proportion of overseas trade. My hon. Friend's Amendment has brought to the attention of the Government the need to keep taxation arrangements under constant review, particularly those affecting transport, and to make doubly certain that at no stage are desirable technological developments frustrated or hampered by a form of taxation drawn up before those technological developments were contemplated.
I appreciate the Joint Parliamentary Secretary's point in reply that the extent of the relief which the Amendment sought was perhaps rather greater than had been appreciated and that in this year's Budget it would perhaps be wrong to seek to press for relief for one form of transport—however desirable it may be, and however much we want to see the development—to the extent that he said would be the case here.
But the debate has performed a useful function in bringing to light the importance of ensuring that the container revolution in all its ramifications is not hindered by out-dated taxation practices. The Committee will be grateful to my hon. Friend for having moved it and enabled the point to be made and supported by many hon. Members on both sides of the Committee.
I feel sure that, having heard the Minister's reply, my hon. Friend will feel it right not to press the matter to a Division. At the same time, it would be equally right that the Minister should not feel that, having given his answer, for which we are grateful, that will be the end of the matter. It must be kept under constant review.

Mr. Bob Brown: I want to thank the hon. Member for Wanstead and Wood-ford (Mr. Patrick Jenkin) for the way



in which he concluded his speech giving the Opposition views, and to correct a statement that I made. I told the hon. Member for Barkston Ash (Mr. Alison) that a mechanical horse would be taxed under Table A, but it would in fact be taxed at the rates shown under Category 3, Part II of Schedule 7, on the unladen weight of the vehicle. A mechanical horse pulling no trailer would be taxed


under Part II at the bottom of page 58, as I have said.

Mr. Alison: In the light of the speeches which have been made from both Front Benches, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause ordered to stand part of the Bill.

Clause 11

CHARGE OF INCOME TAX FOR 1968–69

The Temporary Chairman (Mr. Harold Gurden): The next Amendment selected is Amendment No. 5, with which we shall discuss Amendment No. 6, in clause 12, page 8, line 41, leave out from '£2,000' to end of line 43 and add
'at the following higher rates in respect of the excess, that is to say:—
On the first £2,000 of the incomes chargeable to surtax—Nil.
On the next £500 of the income chargeable to surtax up to £2,500 at 2s. 0d. in the £.
On the next £500 of the income chargeable to surtax up to £3,000 at 2s. 6d. in the £.
On the next £1,000 of the incomes chargable to surtax up to £4,000 at 3s. 6d. in the £.
On the next £1,000 of the income chargeable to surtax up to £5,000 at 4s. 6d. in the £.
On the next £2,500 of the income chargeable to surtax up to £7,500 at 5s. 0d. in the £.
On the next £2,500 of the income chargeable to surtax up to £10,000 at 5s. 6d. in the £.
On the next £2,500 of the income chargeable to surtax up to £12,500 at 6s. 0d. in the £.
On the next £2,500 of the income chargeable to surtax up to £15,000 at 6s. 9d. in the £.
On the remainder of the income at 7s. 6d. in the £.'.

Sir G. Nabarro: I beg to move Amendment No. 5, in page 8, line 36, leave out '8s. 3d.' and insert '7s. 6d.'
I am glad that we have profited from our experience in earlier years, which has facilitated the section of an Amendment dealing with reduction of Income Tax with an Amendment dealing with reorientation and reduction of Surtax, the two most massive forms of direct taxation, for it is very difficult to debate the one without the other.
The purpose of the Amendments in broad principle is to reduce the standard rate of Income Tax from 8s. 3d. in the £ to 7s. 6d. in the £, and so to reorientate all the rates of Surtax as to cause the highest level of Surtax to be 7s. 6d. in the £, so that the greatest earner in Britain and the highest payer of Income Tax and Surtax combined would not have to pay more than 7s. 6d. in the £ in Income Tax and 7s. 6d. in the £ in Surtax, an aggregation of 15s. in the £ on earned income.
That is why I am so grateful to the Chairman of Ways and Means for responding to the request I made to him yesterday that the two Amendments


should be associated the one with the other, so that we could talk in terms of a maximum of 15s. in the £ for direct taxation
In 1966, immediately following the General Election, I moved during the Committee stage of the Finance Bill an Amendment to reduce the standard rate of Income Tax. Then I was persuaded by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) not to take the matter to a vote because economic conditions would not have allowed a reduction in the rate of taxation on the scale I envisaged. I responed to the blandishments of my right hon. Friend and of the Whips and did not force a Division.
In 1967, I set down similar Amendments to that year's Finance Bill and again moved a reduction in the standard rate of Income Tax adding to it a rearrangement of Surtax rates. I took them both to a Division, supported by my party. I am delighted as always to be scouting ahead of my party year by year. That was the purpose of my exercise in 1966 and it succeeded in 1967.
I repeat it this year, although in slightly different form and in a somewhat different economic climate. But then we had a new Chancellor of the Exchequer. He is rather different in his approach to matters of direct taxation. He does not share precisely the views and the fiscal philosophy of the right hon. Gentleman the Home Secretary.
We are delighted to see the Home Secretary now present. It is nice of him to blow me kisses instead of the fiscal raspberries to which I have been accustomed in recent years. I was recalling and recounting how, in 1966 and 1967, he listened to me moving reductions in the rates of direct taxation and always treated me with a measure of scorn, and his reply led the Daily Mail to head its report
Poor old Nab—18s. 3d. in the £
as though I were pleading my own personal case. I was not. I could not care less. There are lots of ways of making money other than from net income after direct taxation, as the Financial Secretary knows so well. Does the Home Secretary wish to interrupt? It is most improper for him to do so on the Finance Bill.

The Secretary of State for the Home Department (Mr. James Callaghan): I only wanted to say, knowing the hon. Gentleman's capacity for wringing the last ounce of publicity out of any given situation, that I hope he will excuse me if I leave. I came in to ask a question of my right hon. Friend. I am sitting in a Committee upstairs and I do not want there to be any feeling that I am walking out in the middle of the hon. Gentleman's speech.

Sir G. Nabarro: I repudiate any suggestion that I desire to wring any publicity out of this speech. I merely observed the right hon. Gentleman's entry and I am delighted to excuse him in view of the importance of his being elsewhere.

Mr. Herbert Butler: How kind.

Sir G. Nabarro: "Magnanimous" would have been the appropriate interjection. I was saying, when so rudely interrupted by the Home Secretary, that there is a marked difference in fiscal philsophy between the present Chancellor of the Exchequer and his predecessor, now the Home Secretary, in this context of direct taxation. The Chancellor is on record at least on two occasions as recognising that very high levels of direct personal taxation are a disincentive to greater effort and harder work.
10.15 p.m.
He resisted the temptation to put up Income Tax this year, for which I and many other people were very grateful; it was sensible of him to resist it. He had told the London Labour Party, on 19th March, 1967, that he thought that any increase in direct taxation could not be conducive to greater output and harder work. In his Budget statement this year he chose his words very carefully, and in that section in which he dealt with the rate of Income Tax he said:
No earned income, save for the effects of the recoveries of family allowances, the principle of which had already been announced, will therefore be subject to higher direct taxation. This I believe to be justified on the ground of incentive."—[OFFICIAL REPORT, 19th March, 1968; Vol. 761, c. 296.]
The former Chancellor always pooh-poohed that any disincentive was caused by high levels of direct taxation. The former Chancellor was always cheered


to the echo by the hon. Gentleman the Member for Ashton-under-Lyne (Mr. Sheldon) and the hon. Gentleman the Member for Heywood and Royton (Mr. Barnett). They both pooh-poohed the speeches from this side of the House.

Mr. Henig: Quite right.

Sir G. Nabarro: We have another one, the hon. Member for Lancaster (Mr. Henig) as well. We have a professorial and academic voice added to that of the theorist of the chartered accountancy profession, his hon. Friend. The present Chancellor thinks otherwise. The present Chancellor at least has come this far towards Conservative views that the present levels of direct taxation are far. far too high.
My hon. Friend the Member for En-field, West said that our levels of direct taxation are not the highest in the world; but they are the highest marginal rates in the world. There is no country in the world that paid 19s. 3d. in the £ last year on the last dollar or the last £ that was earned in any country overseas. Neither, so far as I am aware, is there any civilised, industrialised and sophisticated community comparable to our own where the level of direct taxation this year leads to a top marginal rate of 18s. 3d. in the £. The Financial Secretary may reply that Albania pays 18s. 6d. in the £, or Guyana 18s. 9d. in the £, but these places are not countries, they are not industrialised, sophisticated communities such as ours.
I re-echo comments—I shall not repeat them in the same terms—made upstairs in the Committee that the men in Britain who earn more than £10,000 a year in industry, trade and commerce are the leaders. They are not generally in those positions because of Etonian ties. Very rarely is that the case. In 95 per cent. of the cases they have come from the bottom, earned their promotion the hard way and are sitting in the top executive position because of their ability to lead men and direct great enterprises. All the efforts of millions of working men and women everywhere are brought to nought without the enterprise, skills, drive and imagination of the men in the top executive chairs—

Mr. Eric Lubbock: Like Sir Giles Guthrie.

Sir G. Nabarro: The hon. Member for Orpington (Mr. Lubbock) says, "Like Sir Giles Guthrie". I am not talking about nationalised industries. They are a separate consideration. Their executives are underpaid. There is a stigma associated with working for a nationalised industry at the top level. Real, genuine, honest-to-goodness businessmen do not work for nationalised industries. We in the Conservative Party have always been in great trouble, just as the Labour Party has, in finding top executives for nationalised industries. The hon. Member for Orpington will never suffer such disabilities because he will never be in the Ministerial position required to select these executives.

Mr. Lubbock: The hon. Gentleman has got me wrong. I mentioned Sir Giles Guthrie only because he is not earning the money that he is paid, in spite of the fact that it is less than many of the hon. Gentleman's friends in private industry.

Sir G. Nabarro: I do not think that it would be kind or rational to criticise Sir Giles, who has left his post and is returning to the City. So far as I am aware, he has performed his duties as the head of an air Corporation with distinction and enterprise, notwithstanding all the obvious political disabilities put on him by being head of a nationalised industry.

Mr. Harold Lever: Has it escaped the hon. Gentleman's attention, when making his generalised expressions of contempt for the directors of nationalised industries, that the Chairman of the Central Electricity Board recently has been acquired by one of the great, enterprising world-wide outfits in this country at a very high salary after years of public service?

Sir G. Nabarro: The F.S.T. must get his facts right. It is not the Chairman of the Central Electricity Generating Board, but the Chairman of the Electricity Council. I presume that the hon. Gentleman is referring to Professor Sir Ronald Edwards. The professor served a long stint as head of the Electricity Council. He did very well. Appointed by a Tory Government, he survived four years under a Labour Government. He has now returned to private enterprise industry, where I am sure that he will do even better. I hope that the F.S.T. will make a recommendation in the proper quarter

to send him to another place as an earnest of the Treasury's approbation for his endeavours.

The Temporary Chairman: Order. Could this gentleman be related to the Amendment?

Sir G. Nabarro: I am sorry, Mr. Gurden. I was provoked. I do not think that the F.S.T. is behaving very well tonight. He has been leading me astray.
The fact remains that these punitive levels of direct taxation, Income Tax and Surtax, have three very damaging effects on our national economy. In my judgment, they act as a grave disincentive to further effort at every level, from £1,200 a year up to £100,000 a year, if anyone earns that sum—

Mr. Lubbock: The Chairman of Marley Tiles.

Sir G. Nabarro: The hon. Gentleman says, "The Chairman of Marley Tiles". He is wrong again. Mr. Aisher earns £91,300. However, I am glad that the hon. Gentleman intervened, because that is a preposterous salary. No one is worth £91,300 a year. But why is he paid that huge sum? It is so that he can have an amount of about £12,000 after tax. That he is well worth. If he had £91,000 gross income in the United States of America, his net income would be about £27,500.
I hope that my hon. Friend the Member for Wanstead and Woodford (Mr. Patrick Jenkin) is working it out to check it. It is no good the F.S.T. shaking his head vigorously. He is trying to catch me out, but I shall tell him how I arrive at this. All the civil servants are at work in the box trying to check the figures. On incomes of that size in the United States the effective rate paid is 70 per cent., subject to marginal influences. About 30 per cent. is the net and, in current vernacular, "take-home pay." Thirty per cent. is of the order of £27,000 to £27,500 related to £90,000. I am not going to argue the case of a man with £91,000 a year. The biggest single disincentive of present taxation in Income Tax is in the case of a man earning between £1,200 and £4,000.
I hope that the F.S.T. will not say that down to 2½d. I am inaccurate, Generally in that bracket, between £1,200



and £4,000, for every additional £ earned the man concerned pays 32 per cent. in tax and retains 68 per cent. Above £4,000 a year the assessable Income Tax and later Surtax over the £4,999 level rises very steeply until the excruciating highest levels I have alluded to are eventually reached. All these levels of taxation are a grave disincentive to additional effort at a time when this country urgently needs greater effort and harder work on the part of men and women at every level of industry.
Personal savings in this country are very poor. This is no reflection on Sir Miles Thomas and the National Savings Movement. Last year they clocked up about £80 million of surplus, devalued in their pockets subsequently. The National Savings Movement and similar agencies, which ought to be encouraged to attract a much higher level in aggregation of personal savings than they are presently achieving, are of course knocked back by the present levels of direct taxation. It is no good the F.S.T. saying, "Oh yes, but the money is not available to save." Look what unit trusts did last month—£28 million in a month with new unit trust saving. I wonder why they are doing so well at a time when National Savings are doing so badly? The hon. Member the professor from Lancaster wishes to interrupt? I will give way at once if he wishes to intervene.

Mr. Henig: I was simply wondering what relevance these fascinating considerations about savings and unit trusts have to do with this Amendment.

Hon. Members: Oh.

Sir G. Nabarro: Thank goodness, I was never an undergraduate at the University of Lancaster. Thank goodness, I did not have to send my sons to that university. I think that a night school course at a Polytechnic would have served them better if the hon. Gentleman were the instructor.
The hon. Gentleman asks what are savings to do with the rates of direct taxation. In words of two syllables, so that he can understand, the lower the levels of direct taxes the greater the sums which will be left to fructify in the pockets of the people and the greater the sums which will be attracted to all

the orthodox methods of saving, led by National Savings.
If the hon. Gentleman does not remember it, let him go back five or six years under successive Tory Chancellors and search out that our average performance year by year was £250 to £300 million a year in National Savings surplus. According to all Chancellors, Tory and Socialist, if they can obtain the money from National Savings they do not have to obtain commensurate sums from taxes. I am sorry that the hon. Gentleman is so exasperated with me. I can understand his exasperation. The present levels of taxes militate against the accumulation of small savings.
Thirdly, the present levels of direct taxation aggravate and accentuate the brain drain of professionally qualified men and women who emigrate from this country. There were 70,000 last year. They were not all highly qualified by any means. A few come back, but the great majority of the immigrants are unqualified. About 90 per cent. of the emigrants are qualified and about 90 per cent. of the immigrants are unqualified. I call that a poor exchange—and I am no racialist.
Why do these people go? Some go because of the sun. Some go because they think that Australia's opportunities are better than Britain's. Some go because they fancy Canada. South Africa attracts a lot, and Rhodesia attracts some. But the major reason that they go—not the only reason—is because abroad they will be able to retain a larger part of their hard won earnings.

Mr. Lubbock: That is not true.

Sir G. Nabarro: The hon. Member for Orpington mutters that it is not true.

Mr. Lubbock: If the hon. Member for Worcestershire, South (Sir G. Nabarro) read the report of the Jones Committee, from which I presume he is quoting, it said that the principal reason why young people who are professionally qualified go to the United States and elsewhere is because of the difference in salary structures between ourselves and the States, whereby people early on in their careers get higher earnings over there, whereas their total earnings throughout their careers are not



much different in the two countries. It is nothing to do with taxation. It is the rate of promotion after a person is qualified.

Sir G. Nabarro: The hon. Member for Orpington must think that I do not do any homework before I address the House of Commons. The hon. Gentleman spoke about the Jones Committee. I will quote the Jones Committee to him at once. I quote from the Financial Times of Monday, 23rd October, 1967.

Mr. Lubbock: I get my information first hand.

Sir G. Nabarro: Yes. But the Financial Times is a reputable journal and it quotes the Jones Committee. If the hon. Member for Orpington wishes to say that the Financial Times is mis-reporting the Jones Committee, let him say so, but listen to the extract first.

The Chairman: Order. I must ask the hon. Member to address the Chair.

Sir G. Nabarro: As you know, Sir Eric, it is my habit when speaking to gyrate, and though my body was facing you, I had turned momentarily to face the hon. Gentleman.
The article says:
High quality staff. On the other hand the Jones Committee does emphasise that tax may well sway high quality senior academic staff and industrial specialists and may influence some people who are deciding whether to come back or not.

Mr. Lubbock: The hon. Gentleman said—

Sir G. Nabarro: I said that the brain drain was not due solely to the tax factor, but was in part, a major part, due to it.

Mr. Lubbock: If the hon. Gentleman studies the OFFICIAL REPORT he will find he said that taxation was the principal reason for it. I agree that taxation is a factor, but it is not a major factor, and if the hon. Gentleman had read the Jones Report instead of an extract in the Financial Times he would know that.

Sir G. Nabarro: I shall not weary the Committee by reading the entire Jones Report. I said that this was a major factor. The Jones Report said that it was a factor. The difference between us is minimal. These are all essential ingredients, and my case this evening is

that the House of Commons ought to apply itself once again to the punitive levels of direct taxation extant in this country.
Year by year Tory philosophy in opposition is being moulded, and I am glad to see that it is going in the right direction. The first consideration, as has been brought out in our debates today, and in many earlier debates this year, is that immediately we resume power there will be a switch from direct taxation to indirect taxation. Secondly, there will be a reduction in the rates of direct taxation. My right hon. Friend the Member for Enfield, West in his famous "light at the end of the tunnel" speech said that he would reduce Income Tax by 3d. in the £ this year. Of course the Socialists disagree with that.

Mr. Dempsey: It is a long tunnel.

Sir G. Nabarro: It is a long tunnel with a Socialist Government in office. Mercifully, they will not be there for ever. What I am pleased about is that the Tory Party is moving in the correct direction, which is that at the earliest possible moment we shall reduce the rates of direct taxation, and for the third consecutive year I make this speech drawing attention—

Mr. Henig: The hon. Gentleman will make it again next year.

Sir G. Nabarro: I shall if the Labour crowd is still there. I doubt it though, and I invite my right hon. and hon. Friends to support me in this matter. I do not suggest that 9d. is necessarily the correct figure for a reduction in Income Tax this year, or that my Surtax figures are necessarily the correct ones, but what I am utterly sure of is that if Britain wishes to make progress in a harshly competitive world it is indispensible that we do not mulct our top brains of more than 15s. in the £ as an aggregation of Income Tax and Surtax. The American aggregation of 70 cents, and if the President's 10 per cent. increase in taxes goes through 77 cents, is still far below the British level, which is the equivalent of 91¼ cents.

Mr. Robert Sheldon: I know that the hon. Member for Worcestershire, South (Sir G. Nabarro) is always so busy with his own speeches



that he cannot read the speeches of others, but, had he done so, he would have known better than to say that I am against, and do not understand, the effects of incentives on the tax structure. I have said repeatedly that, although the Opposition's extreme assertions are wrong, there is obviously some disincentive in high levels of taxation. Rather than making the assertions which the hon. Gentleman claimed—unsupported by any evidence, as usual—I have been anxious to hear how the Chancellor could take this into account.
I have argued for not increasing Income Tax, for, where possible, reducing it, and for making good the deficiency in Corporation Tax. There is a disincentive effect, however, unmeasurable, in Income Tax, and this is greater than the disincentive effect of Corporation Tax. Very few managers feel that their companies have earned enough money and that they can go home or play golf, but this may apply to direct taxation, particularly Income Tax. Any disincentive effect of Corporation Tax could be offset by way of investment grants and other subsidies to particular areas. Therefore, rather than the shift to indirect taxation for which the Opposition argue, I would prefer a shift from Income Tax to Corporation Tax.
Hon. Gentlemen make great play of the incentive argument, unsupported by evidence, except for the kind of distortions of the Jones Report which we heard from the hon. Member for Worcestershire, South. I would rather we found out the facts. This could be done through the Government Social Survey. We know that the Chancellor raises over £12,000 million through taxation, and we have a right to know the disincentive effects of this, so that our taxation system can be adjusted to take account of it. I have ben asking for this for the past two years and more and we should be demanding a answer.
That Budget statement implied that my right hon. Friend accepted some of the disincentive arguments: he did not raise Income Tax for that reason. In that case, he must have felt that the £4,600 million being raised by Income Tax and Surtax was near the limit available to him for incurring the effects which he mentioned.
10.45 p.m.
It is up to us to ask my right hon. Friend on what grounds he made this judgment; on what grounds he felt the limit had been reached where, if Income Tax had been raised any more, a disincentive effect would have been produced against the attempts he was making to extend the growth of the economy. What understanding is there of the way decisions are taken? We must know that this was sometimes a hunch.
We ask what kind of investigation was made? We know that there was none. We consider the work carried out by sociologists in all parts of our industrial economy and social life and we should ask ourselves why their help has not been asked for in this important sphere. We see the many millions of pounds raised and we do not understand the effect of raising this money on the decisions which individuals make as to how they will work, and what the disincentive effect will be.
If any industrial organisation failed to carry out simple surveys of this kind, into where its money was coming from, with market research of the simplest kind, it would be held grossly culpable. This issue is raised year after year. It seems to many of us that the Government fail to carry out this investigation into how the disincentive effect works and how we can make the effects work for the economy of the country.
It is time we insisted that this work be carried out, rather than have these statements made in these debates year after year. Some of the things found out by a survey, by the questions asked, should be: what is the effect on overtime working and does tax have a disincentive effect? Do people feel that workers are not working overtime, which might be in the interests of the country, because of this? A small amount of work done on this suggests that there is no disincentive effect.
This work was done in a small sector and few conclusions can be drawn. We also want to know the real attitude of Surtax payers. Do they decline appointments and promotion? What is possibly more important, do they avoid taking risks? Does it make them more cautious? It probably does, but we have no real evidence for it. That evidence is easily available and can be obtained.
Then there is the question of what kind of misunderstanding there is in the minds of the people as to the level of taxation they are paying. Many people are not fully aware of the marginal rates of tax at certain levels. What is the level of this misunderstanding and how can it be put right? Is it just a grumble? Or is striving for success being affected; and if it is being affected, can it be put right?
These problems are capable of solution and in the raising of thousands of millions of pounds, a few thousands might be spent to great effect in finding some of these answers.

Mr. Maude: It seems to me that what the hon. Member for Ashton-under-Lyne (Mr. Sheldon) has said is perfectly true. We need a great deal more knowledge about the effects of high rates of direct taxation on people working, whether on the shop floor or in executive and directorial appointments, but it does not require a great deal of research to know that the marginal effects of high taxation on work, on enterprise, and on initiative, are considerable. Our system of taxation is particularly detrimental because the standard rate has absolutely no justification in logic, financially or economically. Indeed, if it were not for the need for some sort of withholding tax for dividends, it is difficult to believe that we would have our present standard rate system.
Our progressive tax rates go up in a serious of jumps and have a particularly vicious effect at the margins where the jump occurs. On the other hand, I lived for some years in Australia, where there is not a standard rate but a smooth progressive rate of taxation. It is possible for the Treasury to raise or lower the whole of taxation from the very lowest to the top rate of Surtax by 5 per cent. or 10 per cent. in a single Budget without messing about with the standard rate and the lower rates.
At the margin in Britain one gets a disproportionate effect which one does not get: with a smooth progressive code. This effect is particularly bad when one has a high standard rate of direct taxation. It has been less marked over the whole sphere since the minimum Surtax rate on earned income was raised from £2,000 to £5,000, but it is still considerable.
Until and unless we get a sensible system of direct taxation, cutting out the standard rate, with a notional withholding tax for dividends and a smooth, progressive—and, I suggest, a much less steeply progressive—system of taxation, we will continue to have a detrimental effect on overtime earnings and on effort of every kind. Until and unless a Government has the initiative and courage to change the whole system of direct taxation, these difficulties will occur.
If we wish to liberate the energies of our people, we should reduce the standard rate of tax. While nobody, including my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro), would claim to know that the best results would be obtained by a reduction of, say, 9d. in the £ in the standard rate, the marginal effect of such a move, when workers now find that every extra 1d. they earn is charged at 8s. 3d. in the £, cannot be doubted.
I hope that my hon. Friends support the Amendment as a demonstration against a rate of direct taxation which is far too high and which should be reduced.

Mr. John Cronin: I must compliment the hon. Member for Stratford-on-Avon (Mr. Maude) for suggesting that there should be a more smoothly progressive rate of Income Tax, which would obviously be beneficial for the working of the whole tax system. However, it would require more than courage for such a change to be made. It would require a complete change of our whole system of taxation and it would present immense difficulties.
I do not support the Amendment, and I do not believe that hon. Gentlemen opposite seriously support it. They must be aware that a substantial reduction in the rates of direct taxation now would indicate a premature tendency to reflation and, therefore, a run on the £.

Mr. Michael Shaw: In which year since the present Government came into power would it have been appropriate under those conditions for us to suggest a lowering of taxation?

Mr. Cronin: That is not relevant to the argument. The Amendment would be deleterious now. The hon. Gentleman the Member for Worcestershire,



South (Sir G. Nabarro) has done a very good job for the Conservative Party in moving the Amendment. All those industries, bankers and businesses which contribute to Tory Party funds will say, "Good old Gerald. He's done his stuff. We are on the right side and investing our money satisfactorily." I cannot believe that the hon. Gentleman imagines that the Amendment is in the national interest.

Sir G. Nabarro: I will give the exact cost. Reducing the standard rate from 8s. 3d. in the £ to 7s. 6d. would cost £180 million in a full year. Reducing the top level of Surtax so that no one would pay more than 15s. in the £ would cost £4 million only.

Mr. Cronin: The hon. Gentleman cannot believe that it is as simple as that. He is completely ignoring the psychological effect, which is the all-important thing for sterling. The hon. Gentleman spent most of his time shedding tears over the unfortunate people who pay 18s. 9d. in the £. It is no part of my brief to speak on behalf of such people.

Sir Tatton Brinton: The hon. Gentleman mentions 18s. 9d. in the £. I take it that he means either 19s. 8d. or 18s. 3d. Can he be more precise?

Mr. Cronin: I accept the correction with pleasure.
I must compliment the Chancellor for not increasing the standard rate, although he may have been under presure to do so. I hope that in the future he will be able to reduce the standard rate of Income Tax. The present high rate has serious disadvantages. Some of our opinions on this side should be revised in the light of modern circumstances. It was Socialist thinking that increases in direct taxation were desirable because it was mainly the well-to-do who paid direct taxation, and normally the mass of the working people paid hardly any at all.
There has been a very big change. Although we are proud that we have a progressive system of taxation, with the heaviest burdens falling on those most able to bear them, there is no doubt that a large part of the population pays Income Tax on a substantial scale. The Report of the Commissioners of Inland

Revenue, Command 3508, shows that those who pay the largest amount of total tax are in the income group of £1,000 to £1,500 a year. Of that group there are 5,900,000 who pay Income Tax. Between them, they pay £770 million out of a total income of £7,260 million, which is more than 10 per cent. of their incomes. Now these are the people, our skilled workers and their wives who are presumably taken as one unit of income, who we should desire to encourage. It is particularly undesirable to reduce their incentive to work. I therefore feel that a reduction of Income Tax, particularly of the standard rate, would have a very direct and beneficial effect of this group of people.
11.0 p.m.
One of the problems of high direct taxation is that it is paid only by a very limited number of the people who should normally pay it. These high rates lend themselves very considerably to evasion and avoidance. For instance, it is very difficult to believe that as much tax is collected from Schedule D as really should be. If hon. Members look at Table 72 of the Report, Cmnd. 3508, they will notice that about 350,000 people in this country either own businesses or are engaged in professions which bring them less than £300 a year income. I find it very difficult to believe that some of these people are not taking part in some form of avoidance or even evasion.
The hon. Member for Worcestershire, South has referred to the brain drain, with 70,000 qualified people leaving the country every year. There is obviously a taxation consideration which must be a motive behind the disappearance of these people overseas. The most important thing, it seems to me, is the actual disincentive effect of high rates of direct taxation on the desire to work, as opposed to the desire to have leisure. It does not require any investigation to come to this conclusion. It obviously must reduce the incentive to do overtime and extra work.
I fully agree with my hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) that an inquiry into the precise disincentive effects of direct taxation is desirable. It is something which the Government should have done a long time ago. I recollect that when the Royal Commission on the Taxation of



Profits and Incomes, in a Report about 11 years ago, dealt with this matter, they did so in a somewhat sketchy way and did not produce any real evidence to show whether or not there was a disincentive effect. There is no doubt that there must be a disincentive effect. There must also be, as a result of high rates of direct taxation, a tendency towards consumption rather than saving. Finally, there is also a preference, if anybody does save, to have an asset which produces benefits in kind rather than an asset which produces a monetary return.
A person who has saved £500 or £1,000 prefers to have a motor car which gives him some benefit in kind rather than monetary savings on which the interest is highly taxed. So, from the point of view of incentive, I think it very important, if there is to be expansion of the economy in the future, that there should be some reduction in the standard rate of Income Tax.
Finally, it is important that the Government should think about the political effect of high rates of taxation. There is no doubt that hon. Gentlemen opposite like the hon. Member for Worcestershire, South, do have a willing ear from the public. They say, "Ah! These chaps are in favour of lowering taxation." This has a political effect which cannot be ignored, and I cannot believe it is to the advantage of our party that we should be known as the party which prefers high direct taxation. [HON MEMBERS: " It does."]
I am advising my right hon. and hon. Friends. It is undesirable that we should have this reputation. I accept that the rate of direct taxation is particularly high at present. This has a most undesirable political effect for us on this side of the House.
It seems to me that the very highest good for this country is to continue to have a Socialist Government. Anything which contributes to that summum bonum is something that we should encourage. The political effects of continued high direct taxation will not, therefore, be in the national interests. Finally, I hope that my hon. Friend the Financial Secretary will convey to my right hon. Friend the Chancellor of the Exchequer some of these remarks, and advise him that during the course of what I hope will be the long reign of Labour Government

a time must soon come when direct taxation should be lowered.

Mr. Ridsdale: The first thought hon. Members opposite seem to have about anything is, "Let us hold an inquiry." Do we really need to hold an inquiry into the disincentive effects of direct taxation? Hon. Members have spoken to people earning £20 a week, such as railwaymen, many of whom must work overtime to earn that sum, know very well that disincentive effects direct taxation has. That is why I welcome the Chancellor's statement in his Budget speech that he would try to move from direct to indirect taxation, to take many people out of direct taxation. To my mind, that is Conservative policy.
I hope that he particularly had in mind those earning £20 a week. I am absolutely convinced that until we can take out of direct taxation altogether the person earning £20 or even £25 a week we shall not get productivity going to the necessary extent, nor shall we get personal savings at the necessary level.
The hon. Member for Loughborough (Mr. Cronin) talked about the desire to encourage saving, saying that his right hon. and hon. Friends must look to the party advantage. But we must think about the national advantage and not the party advantage. If we think about the national advantage, we must realise that the only way we can encourage personal saving again is to cut back on direct taxation. Saving has fallen in the past few years because of the philosophy of the Socialist Government, who believe that saving can be done only by the Government. That it what is wrong. That is why my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) was so right when he said that money should fructify in the pockets of the people rather than in the coffers of the State. That is our philosophy, and why we know that Socialism can never succeed.
I feel that this is almost a Second Division debate. I read the OFFICIAL REPORT of the Standing Committee stage. I read with great interest the very eloquent speech of the hon. Member for Birmingham, All Saints (Mr. Walden) and the Chancellor's replies. But the Chancellor has been here for only a very short period today. How are we and the country to know his thinking, when he



speaks upstairs almost in secret, where the Press cannot go, and does not come here to reply—

Mr. Harold Lever: The hon. Gentleman is mistaken. The Press not only could go, but every facility of a mechanical kind was given to it to enable it to report our proceedings.

Mr. Ridsdale: The Committee stage upstairs was not in the atmosphere to which we are accustomed on the Floor of the House, with the Chancellor here, instead of being closeted in a small room with a few hon. Members and no public in the gallery. I hope that we shall, at this stage and on Report, hear the Chancellor replying to some of our debates. I am disappointed that he has hardly been here all day, particularly so when we are having such an important debate as this.
We are discussing much more than whether taxation should be reduced by 9d. or 6d. in the £. We are discussing the whole philosophy of taxation and finance, and I should like to have heard the right hon. Gentleman. I believe that we shall only go along the right road for the economy if we lower the rates of direct taxation and shift the burden to indirect taxation, when we can shift the burden from those earning £20 a week and give at least some encouragement to them to see their savings in their own pockets and not taken and saved by the State.

Whereupon Motion made, and Question, That the Chairman do report Progress and ask leave to sit again.—[Mr. Harper]—put and agreed to.

Committee report Progress; to sit again Tomorrow.

MR. FRANK ALLEBONE (PENSION)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Harper.]

11.12 p.m.

Mr. Harry Howarth: I am grateful for the opportunity to raise the unfortunate circumstances which have led one of my constituents, Mr. Frank Allebone, to believe that he has suffered an injustice. I appreciate the attention which my hon. Friend has given to the case in correspondence with me, but, nevertheless, I believe that I must draw attention to this matter in view of Mr. Allebone's complaint.
The circumstances are that, prior to the Second World War, Mr. Allebone was in good health and in regular employment in the boot and shoe industry. He enlisted in the Army in April, 1942, and was found to be Grade I medically on his enlistment. There was no question of his suffering from any disease. He served in Sicily and Italy for almost three years and it was whilst he was in Italy that, during a medical examination, it was discovered that he was suffering from diabetes mellitus.
I have seen a copy of Mr. Allebone's medical history from his enlistment to his dicharge on medical grounds and I am satisfied from what I have read that, from the first time that diabetes was discovered until his discharge—and I am sure that he would wish me to say this— he had the best of medical attention. I have had no complaint about the treatment he received.
However, during the proceedings on his invaliding out of the Army and while in the convalescent home, Mr. Allebone was asked the following question prior to his examination:
If you are suffering from any disease, wound or injury, state what it is, the date upon which it started and what in your opinion was the cause of it".
Mr. Allebone replied that he was suffering from diabetes and that it was first discovered during a medical examination in Italy on about 5th April, 1946. He further stated that the cause might be



due to exposure, etc. A further question to which Mr. Allebone answered "No", was:
Did you suffer from the disease or injury or anything like it before joining the service?
In the report later issued by the officer in medical charge of the case, referring to my constituent's discharge, it was stated that the date of origin was approximately October, 1945, at Undine, Italy. Eventually, Mr. Allebone was discharged from the Army on 19th December, 1946, with no pension awarded. It is perhaps understandable that he appealed against this decision. He based his claim on the fact that before joining the Army he was fit and well and able to do a good day's work in a factory, whereas he was discharged with a recommendation for light work.
Mr. Allebone spent three years in the front line in Italy and Sicily and was exposed to all kinds of weather, as were many who were with him. For days on end he was soaked with no means of getting dry. He claimed that exposure and damp were the cause of his disability. I do not think that there is any disagreement that Mr. Allebone was a fit man when he joined the Army, but if there is, certificates have been issued by his previous employers saying that he was never absent from work because of ill-health. It is true that during his service in the Army there was no medical incident until the one in April, 1946, which led to his ultimate discharge. It is only fair to say that the medical officer acting for the Director General of the Services on behalf of the then Minister of Pensions discounted the fact that exposure and dampness were the causative factors of his disability and were not medically acceptable.
The Minister's doctors attached great importance to the fact that Mr. Allebone had not required hospital treatment during his service nor had he been aware of his condition until his routine medical examination, but I have no doubt that for some months he had been suffering, if only slightly, from this trouble, which was apparently then in its early stages. I have been talking of Mr. Allebone, who was discharged from the Army over 20 years ago, fit only for light work. What is the position today? He is now 60 years of age and is unable to work at all as a result of this disability, which he

still maintains he contracted through his service in the Army. He has had to have a leg amputated. In addition, his other leg is causing some concern and his wife writes to me that he has suffered with his legs for over 15 years and has been able to walk only a few yards without a lot of pain.
Is it surprising that both my constituent and his wife feel very bitter about this whole business? He was perfectly fit when he went into the Army, he served most of his time overseas in the front line and then it was found that he had diabetes and he was discharged fit only for light work. I said that I appreciate the attention which my hon. Friend has given to this case. I know that there must be many cases such as this throughout the country where difficult decisions have to be made in the light of the circumstances surrounding each case, but are there so many of them that we must strictly observe the rules laid down, the necessity for the man to prove that he became disabled as a result of Army Service. How can he obtain such proof? Of course, he might have become disabled had he not been in the Army, but who is in a position to say definitely that that is so? It is purely a matter of conjecture.
Is it not possible in these cases for some payment to be made in order to help a man over what must be a very difficult period of his life? I know that my hon. Friend has sympathy and compassion in cases such as this, and I hope he will agree to look at the case of Mr. Allebone again in the light of all that I have said, and in the light of the difficulties which he has faced over the past 20 years, after serving his country so well during the last war, if only by an ex gratia payment, so as to give some comfort and hope to him and his wife for the future.

11.20 p.m.

The Joint Parliamentary Secretary to the Ministry of Social Security (Mr. Charles Loughlin): My hon. Friend the Member for Wellingborough (Mr. Harry Howarth) has raised a case which must command the sympathy of the House. As he has explained, Mr. Allebone, now aged 60, served during the war with the Royal Artillery for four and a half years, almost three years of that time with the Mediterannean forces. In April 1946, as



my hon. Friend says, he had a routine examination in connection with his release from the Army and was then admitted to hospital in Italy for investigation of a finding of sugar in the urine. He gave a history of pleurisy several years before enlistment, and of inflammation of the gums in December, 1945; there was no other medical history at all. Diabetes mellitus was diagnosed, although, here again, there was no family history of diabetes, and he himself gave no history of symptoms relevant to the disease.
Mr. Allebone was put on a diet to control the condition, and was returned to the United Kingdom, where, in May, 1946 he was admitted to Whitchurch Emergency Hospital, Cardiff, later to a hospital nearer his home and then to a convalescent depot. After his condition had been stabilised by diet—he did not require insulin—the Army started invaliding proceedings in June, 1946 and he was formally discharged from the Army three months later.
As I explained to my hon. Friend when I wrote to him in April, Mr. Allebone's entitlement to a war pension was thoroughly considered following his discharge from the Army, but, after studying all the evidence, our doctors were unable to certify that his condition had been caused or made worse by service. They said that the diabetes mellitus was a constitutional metabolic disease, the onset of which had not been affected by any factor arising from war service. In the circumstances, his claim to a war pension had to be refused.
Mr. Allebone appealed to the pensions appeal tribunal against this decision, and we prepared a statement of case setting out all the evidence, together with the medical reasons for refusing his claim. Mr. Allebone stressed, as my hon. Friend stressed tonight, his fitness prior to enlistment, and attributed his condition to exposure and damp during the three winters spent in the front lines in Sicily and Italy.
Our doctors reaffirmed their earlier advice, explaining that diabetes mellitus is a disorder of the carbohydrate metabolism due to an inborn weakness of the pancreas. They pointed out that, as he had not required any hospital treatment during service, nor had he been aware

of his condition until its discovery at his routine release medical examination, they remained satisfied that the onset and course of the disability had not been adversely influenced by any service factor, including exposure and damp. In view of this advice, we were still unable to admit the claim, and the appeal went forward to the pensions appeal tribunal.
The hearing of Mr. Allebone's appeal was adjourned on three separate occasions; the first time to obtain an independent specialist's opinion; the second time to await the decision on a test case with the emphasis on obesity, from which Mr. Allebone also suffered; and the third time for the consideration of fresh evidence given orally by Mr. Allebone, and of the decision on another test case with the emphasis on stress and strain which had shortly before been decided in the High Court. Mr. Allebone was assisted throughout by the British Legion, which of course, has a wide experience in appeal cases of this kind. The tribunal, which had before it all the evidence, including the arguments put forward by Mr. Allebone, finally ruled in February, 1950 that the diabetes mellitus was neither attributable to nor aggravated by service, and it disallowed the appeal.
The tribunal is a statutory body coming within the jurisdiction of the Lord Chancellor and is entirely separate from and independent of my Ministry. The ruling of the tribunal is legally binding upon both the Minister and Mr. Allebone and can be overruled only by the High Court on a point of law. I think that my hon. Friend will accept that there has never been any question of the possibility of taking the case to the High Court on a point of law.
My hon. Friend has suggested that my right hon. Friend should exercise her powers to make ex gratia payments to Mr. Allebone, having regard to his good service and to his fitness on enlistment and taking account of the fact that he was invalided. He has explained that Mr. Allebone is now unable to work and that, as a result of his disability, has had to have a leg amputated.
The position in relation to ex gratia payments is that, under the Royal Warrant of 1884, the Minister has power, with the concurrence of


the Lords Commissioners of the Treasury, to grant a pension in exceptional cases to a person who does not qualify for a pension under the normal Royal Warrant. However, it would not be a proper use of this power to use it to override the decision of an independent Tribunal which has decided that there is no connection between a person's disability and his service in the Armed Forces. The remedy which the law provides where revision of a tribunal decision is sought lies either in an appeal to the High Court on a point of law or, where vital fresh evidence has been adduced, in an application to the High Court for the case to be remitted for rehearing by the pensions appeal tribunal.
It has been the policy of successive Governments to provide preferential benefits under the War Pensions Scheme which reflect the country's awareness of its indebtedness to those who have been disabled or bereaved as a result of service. The justification for a preferential scheme is an insistence on the causative effect of service, and if we were to abandon this causal link as a basis for admission to the benefits of the War Pensions Scheme, we should be abandoning the case for such a scheme.
I appreciate that my hon. Friend has pleaded that there may not be many of these cases and, therefore, that we ought to be able to be generous, and that, even though there is no causal link between the disability and the service, we ought to

give some form of ex gratia payment. However, he must accept that there are an enormous number of these cases and, in any event, the causal link is the key to the whole pensions scheme.
I am very sorry that I cannot give my hon. Friend better news. In the correspondence to which he referred, I have already explained to him Mr. Allebone's right of appeal on a point of law to the High Court. I can only add that I would certainly consider any fresh evidence produced which might form the basis of an application for a rehearing, with the leave of the High Court. But that evidence would have to be fresh and cogent evidence for this purpose.
It is not very easy for a Minister to examine cases of this kind where it is known that the applicant is in ill-health and has a disability. I can assure my hon. Friend that I have the greatest sympathy with all those people who served in the Armed Forces and who, although not caused by such service or by war service, are suffering illness in consequence of a constitutional defect or a degenerative condition. Unhappily, there are only some areas in which one can operate and, although I have every sympathy with Mr. Allebone I am sorry that I cannot concede to my hon. Friend's request.

Question put and agreed to.

Adjourned accordingly at half-past Eleven o'clock.